. Select the correct label for each line and fill in the amount. In classifying the investments, choose a categorization which seems most likely, given the pattern of transactions in the journal entries. Enter all amounts as positive numbers. If an amount box does not require an entry, leave it blank.
Trading Securities
$fill in the blank 73dda2069024015_2
fill in the blank 73dda2069024015_4
$fill in the blank 73dda2069024015_6
Available-For-Sale Securities
$fill in the blank 73dda2069024015_8
fill in the blank 73dda2069024015_10
$fill in the blank 73dda2069024015_12
2. Where on the balance sheet do trading securities appear?
.
3. Where on the financial statements do available-for-sale securities NOT appear?
.
4. Where are held-to-maturity securities reported?
. Based on the journal entries for this year, does the company have any held-to-maturity securities?
.
5. Where are securities held for strategic reasons reported on the financial statements when using the equity method?
. Based on the journal entries for this year, does The Wellington Company have any equity securities?
.
6. Which of the following items does not affect net income?
.
Transcribed Image Text:Jul. 1
Cash
19,630
Loss on Sale of Investment
190
Interest Revenue
20
Investments-Sunset Village Bonds
19,800
Aug. 14 Cash
41,300
Gain on Sale of Investments
1,800
Investments-Harding Construction Stock
39,500
Aug. 27 Cash
3,600
Investment in Minions Corp. Stock
3,600
Sep. 22 Cash
30,500
Gain on Sale of Investments
3,500
Investments-Mays and Co. Stock
27,000
Sep. 30 Cash
150
Interest Revenue
150
Nov. 1
Investment in Minions Corp. Stock
21,600
Income of Minions Corp.
21,600
Dec. 31 Unrealized Loss on Available-For-Sale Investments
3,275
Valuation Allowance for Available-For-Sale Investments
3,275
Dec. 31 Valuation Allowance for Trading Investments
2,150
Unrealized Gain on Trading Investments
2,150
Transcribed Image Text:The Wellington Company
You are working for The Wellington Company on temporary assignment while one of the accountants is on family leave. You have been asked to review the company's investment journal entries and
provide necessary information to the accountant preparing the financial statements.
Journal
Date
Description
Debit
Credit
Jan. 17 Investments-Red Rock Co. Stock
39,600
Cash
39,600
Feb. 5
Investments-Sunset Village Bonds
36,000
Interest Receivable
310
Cash
36,310
Feb. 23 Investments-Mays and Co. Stock
27,000
Cash
27,000
Mar. 31 Cash
360
Interest Receivable
310
Interest Revenue
50
Apr. 6
Investment in Minions Corp. Stock
180,000
Cash
180,000
Apr. 30 Cash
750
Dividend Revenue
750
Jul. 1
Cash
19,630
Definition Definition Method of recording financial transactions in the book of original entry by debiting and crediting the accounts affected by a transaction using the golden rules of accrual accounting.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
