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5. Marching Tires, Inc. acquired 39,000 shares of Urethane Corporation stock at a price of $40 per share during 2014. Marching classified the transaction as an available-for-sale investment. The market value of the shares at December 31, 2014, is $45 per share, resulting in an unrealized gain of $195,000 recorded at year-end. Prepare the journal entry needed to record the partial sale of the available-for-sale investment. Assume that Marching sold 13,400 of the Urethane shares for $46 per share in 2015 and the fair value of the remaining shares is $45 per share on December 31, 2015. Prepare the journal entry needed to record the partial sale of the available-for-sale investment. (Record debits first, then credits. Exclude explanations from any journal entries.) Account (1) Cash (2) Available-for-Sale Equity Investments (3) Unrealized Gain/Loss - Net Income (4) Now, prepare the journal entry to record the fair value adjustments. Account (5) (6) (7) (8) Entry on Disposal December 31, 2015

5. Marching Tires, Inc. acquired 39,000 shares of Urethane Corporation stock at a price of $40 per share during 2014. Marching classified the transaction as an available-for-sale investment. The market value of the shares at December 31, 2014, is $45 per share, resulting in an unrealized gain of $195,000 recorded at year-end. Prepare the journal entry needed to record the partial sale of the available-for-sale investment. Assume that Marching sold 13,400 of the Urethane shares for $46 per share in 2015 and the fair value of the remaining shares is $45 per share on December 31, 2015. Prepare the journal entry needed to record the partial sale of the available-for-sale investment. (Record debits first, then credits. Exclude explanations from any journal entries.) Account (1) Cash (2) Available-for-Sale Equity Investments (3) Unrealized Gain/Loss - Net Income (4) Now, prepare the journal entry to record the fair value adjustments. Account (5) (6) (7) (8) Entry on Disposal December 31, 2015

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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5. Marching Tires, Inc. acquired 39,000 shares of Urethane Corporation stock at a price of $40 per share during 2014. Marching classified the transaction as an available-for-sale investment. The market value of the shares at December 31, 2014, is $45 per share, resulting in an unrealized gain of $195,000 recorded at year-end. Prepare the journal entry needed to record the partial sale of the available-for-sale investment. Assume that Marching sold 13,400 of the Urethane shares for $46 per share in 2015 and the fair value of the remaining shares is $45 per share on December 31, 2015. Prepare the journal entry needed to record the partial sale of the available-for-sale investment. (Record debits first, then credits. Exclude explanations from any journal entries.) Account (1) Cash (2) Available-for-Sale Equity Investments (3) Unrealized Gain/Loss - Net Income (4) Now, prepare the journal entry to record the fair value adjustments. Account (5) (6) (7) (8) Entry on Disposal December 31, 2015
Transcribed Image Text:5. Marching Tires, Inc. acquired 39,000 shares of Urethane Corporation stock at a price of $40 per share during 2014. Marching classified the transaction as an available-for-sale investment. The market value of the shares at December 31, 2014, is $45 per share, resulting in an unrealized gain of $195,000 recorded at year-end. Prepare the journal entry needed to record the partial sale of the available-for-sale investment. Assume that Marching sold 13,400 of the Urethane shares for $46 per share in 2015 and the fair value of the remaining shares is $45 per share on December 31, 2015. Prepare the journal entry needed to record the partial sale of the available-for-sale investment. (Record debits first, then credits. Exclude explanations from any journal entries.) Account (1) Cash (2) Available-for-Sale Equity Investments (3) Unrealized Gain/Loss - Net Income (4) Now, prepare the journal entry to record the fair value adjustments. Account (5) (6) (7) (8) Entry on Disposal December 31, 2015
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