Presented below is information related to the purchases of common stock by Flounder Company during 2020....
Presented below is information related to the purchases of
common stock by Flounder Company during 2020.
|
Cost |
Fair Value |
|||
| Investment in Arroyo Company stock | $104,000 | $85,000 | ||
| Investment in Lee Corporation stock | 273,000 | 328,000 | ||
| Investment in Woods Inc. stock | 173,000 | 182,000 | ||
| Total | $550,000 | $595,000 |
(Assume a zero balance for any Fair Value Adjustment
account.)
| (a) | What entry would Flounder make at December 31, 2020, to record the investment in Arroyo Company stock if it chooses to report this security using the fair value option? | |
| (b) | What entry would Flounder make at December 31, 2020, to record the investments in the Lee and Woods corporations, assuming that Flounder did not select the fair value option for these investments? |
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Presented below is information related to the purchases of
common stock by Flounder Company during 2020....
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