Question

Hartford Today Publishers completed the following investment transactions during 2018 and 2019: (Click the icon to view the transactions.) Requirements 1. Journalize Hartford Today's investment transactions. Explanations are not required. 2. On December 31, 2018, how would the Lovely stock be classified and at what value would it be reported on the balance sheet? Requirement 1. Journalize Hartford's investment transactions. Explanations are not required. (Record debits first, then credits. Exclude explanations from journal entries. If no entry is required, select "No entry required" on the first line of the Accounts column and leave the remaining cells blank.) Dec. 6, 2018: Purchased 2,000 shares of Lovely stock at a price of $27.00 per share, intending to sell the investment next month. Hartford did not have significant influence over Lovely. Date Accounts Debit Credit More Info 2018 Dec. 6 2018 Dec. 6 Purchased 2,000 shares of Lovely stock at a price of $27.00 per share, intending to sell the investment next month. Hartford did not have significant influence over Lovely. 23 Received a cash dividend of $1.70 per share on the Lovely stock. 31 Adjusted the investrient to ils market value of $22.00 per share. 2019 Jan. 27 Sold the Lovely stock for $26.30 per share. Print Print Done

Answer 1

1.

Journal Entries in the books of Hartford Today Publisher
		Amount	Amount
6-Dec-18	Short Term Investment A/c----------------Dr.                              To Cash/Bank A/c (Being 2000 shares acquired @ 27 per share for 1 month)	$ 54,000	$ 54,000
23-Dec-18	Cash A/c------------------------Dr.                             To Dividend Income (Being dividend received @ 1.7 per share)	$    3,400	$    3,400
31-Dec-18	Unrealized Loss on Investment A/c-------Dr.                            To Short Term Investment (being decrease in market value of shared by $5 adjusted in books)	$ 10,000	$ 10,000

2. As on 31 Dec 2018, The Lovely stock will be shown under Current assets as Short term Investment and will be valued at $ 44,000 ($ 54,000- $ 10,000) at market value.