Question

question the previous attempt. Available-for-Sale Securities Company A bonds Company B notes Company C bonds Cost $534,300 159,490 661,900 Fair Value $490, eee 148,000 644,280 Stoll enters into the following transactions involving its available for sale debt securities this year. Jan. 29 Sold one-half of the Company B notes for $78,500. July 6 Purchased bonds of Company X for $120,680. Nov. 13 Purchased notes of Company 2 for $267,000. Dec. 9 Sold all of the bonds of Company A for $519,000. The fair values at December 31 are B. $83,900, C. $608,900, X, $100,000, and Z. $275,000. Required: 1. Prepare journal entries to record these transactions, including the December 31 adjusting entry to record the fair value adjustment for the long-term investments in available for sale securities. 2. Determine the amount Stoll reports on its December 31 balance sheet for its long-term investments in available for sale securities. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare journal entries to record these transactions, including the December 31 adjusting entry to record the fair value adjustment for the long-term Investments in available-for-sale securities. < Prev 12 of 6 H Next >

Answer 1

Date CR DR $ 78,500.00 Particulars Jan-29 Bank Company B notes Profit on sale of Company B notes $ $ 74,000.00 4,500.00 $ 1,20,600.00 Jul-06 Company x bonds Bank $ 1,20,600.00 $ 2,67,000.00 Nov-13 Company Z notes Bank $ 2,67,000.00 $ 5,19,000.00 Dec-09 Bank Company A bonds Profit on sale of Company A bonds $ $ 4,90,000.00 29,000.00 CR Adjustment entry Date Particulars Dec-31 Fair value adjustment on Company B notes Fair value adjustment on Company C bonds Company x bonds Fair value adjustment on Company Z notes Company B notes Company C bonds Fair value adjustment on Company x bonds Company Z notes DR $ $ $ $ 9,900.00 35,380.00 20,600.00 8,000.00 $ $ $ $ 9,900.00 -83900-74000 35,380.00 =644280-608900 20,600.00 =120600-100000 8,000.00 =275000-267000 2 The amount Stool company reports in its Balance Sheet as on 31 December with regard to Securities held for Sale = 1067800 Particulars Company B notes Company C bonds Company X bonds Company Z notes Total Book Value 74000[$148000*50%] $ $ $ Unrealised gains [Fair Value Fair Value Adjustment] $ 83,900.00 $ 9,900.00 6,44,280.00 $ 6,08,900.00 $ 35,380.00 1,20,600.00 $ 1,00,000.00 $ -20,600.00 2,67,000.00 $ 2,75,000.00 $ 8,000.00 $ 10,67,800.00