Question

Problem 17-11 Grouper Corp. invested its excess cash in securities during 2017. As of December 31, 2017, the securities portfolio consisted of the following common stocks Security Quantity Cost Fair Value Lindsay Jones, Inc. 1,000 shares $15,100 $21,100 Poley Corp. 2,000 shares 39,700 41,700 Arnold Aircraft 2,000 shares 71,300 59,500 Totals $126,100 $122,300 What should be reported on Grouper's December 31, 2017, balance sheet relative to these securities? What should be reported on Grouper's 2017 income statement (if ne entr required, select "No Entry" for the account titles and enter for the amounts.) Grouper Corp Balance Sheet (Partial) Income Statement

Answer 1

The investment shall be recorded at cost or fair value whichever is lower. As on December 31, 2017 Grouper Corp. Balance Sheet (Partial) as on December 31, 2017 Investments Lindsay Jones, Inc Poley Corp. Arnold Aircraft 71,300 (-) Unrealized loss on fair value -11,800 Total 15,100 39,700 59,500 1,14,300 $ Income Statement (Partial) For the year ended December 31, 2017 Other Non-Operating items Unrealized loss on fair value Total -11,800 -11,800

As on December 31, 2018 Grouper Corp. Balance Sheet (Partial) as on December 31, 2018 Investments Lindsay Jones, Inc Duff Company 16,200 (-) Unrealized loss on fair value -4,500 48,400 11,700 Arnold Aircraft (-) Unrealized loss on fair value Total 59,500 -37,400 $ 22,100 82,200 Income Statement (Partial) For the year ended December 31, 2018 Other Non-Operating items Unrealized loss on fair value (4500+37400) Loss on sale of shares of Poley Corp (39700-37900) -41,900 -1,800 Total $ -43,700

As on December 31, 2019 Grouper Corp. Balance Sheet (Partial) as on December 31, 2019 Investments Duff Company (+) Unrealized gain in fair value 5,850 50 $ 5,900 Arnold Aircraft (+) Unrealized Gain on fair value Total 22,100 49,200 $ 71,300 77,200 Income Statement (Partial) For the year ended December 31, 2019 Other Non-Operating items Unrealized gain on fair value (50+49200) Loss on sale of shares of Lindsay Jones (48400-40100) 49,250 -8,300 Total 40,950 Total Loss on sale of 500 shares of Duff (-) Unrealized loss on 500 shares of Duff Further loss on sale (4500*500/1000) 2,700 -2,250 450 Book Value for 500 shares as on beg. (11700*500/1000) (+) Increase in fair value Value to be recorded for Duff company shares 5,850 50 5,900 $