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Presented below is information related to the purchases of common stock by Lilly Company during 2020. Investment in Arroyo Co

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Answer #1
No. General Journal Debit Credit
(a) Unrealized holding gain or loss ($100000 - $80000) 20000
Equity investment in Arroyo 20000
(To record the investment at fair value)
(b) No journal entry 0
No journal entry 0

Note: Since Lilly did not select the fair value option for the investments in Lee Corporation and Woods Inc., the same will continue to be carried at cost and no journal entry will be required at December 31, 2020.

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