Please solve this accounting problem correctly. Fill out every single box with the right information **Understanding Unrealized Gains and Losses in Investment Securities**Sunland Corporation classifies its investments in debt securities as either trading securities or available-for-sale securities. As of December 31, 2022, the following cost and fair value details are noted:| Category | Cost | Fair Value | Unrealized Gain (Loss) ||------------------------------|---------|------------|------------------------|| Trading securities | $95,500 | $85,000 | $(10,500) || Available-for-sale securities| $59,000 | $62,000 | $3,000 |**Key Insights:**- **Trading Securities:** These have decreased in value, resulting in an unrealized loss of $10,500.- **Available-For-Sale Securities:** These have increased in value, leading to an unrealized gain of $3,000.**Balance Details for December 31, 2021:**- The Fair Value Adjustment for trading had a debit balance of $2,100.- The Fair Value Adjustment for available-for-sale had a credit balance of $6,700.**Journal Entries:**To accurately reflect these changes for December 31, 2022, prepare relevant journal entries for each security type:1. **Trading Securities:** - Prepare the journal entry needed for the unrealized loss. 2. **Available-for-Sale Securities:** - Prepare the journal entry needed for the unrealized gain.*(Note: Ensure all debit entries precede credit entries. The format automatically indents credit account titles. If an entry isn't required, select "No entry" and input 0 for amounts.)*This detailed approach aids in understanding how market fluctuations impact financial statements and ensures accurate reporting in compliance with accounting standards.

Existing balances in : Fair value adjustment - Trading account = $2,100 debit Fair value adjustment - Available for sale = $6,700 credit1) Trading Securities: Unrealized loss at the end of the year = $(10,500) Balance in Fair value adjustment - Trading account is $2,100 ,hence in order to bring it to credit balance of $(10,500), adjustment need to be made for (10,500)-2,100 = $(12,600) Journal entry: Account Titles and explanation Debit Credit Unrealized loss on trading securities $12,600 Fair value adjustment - Trading account $12,600 2) Available for sale securities: Unrealized gain at the end of the year = $3,000 Balance in Fair value adjustment - Available for sale account is $6,700 ,hence in order to bring it to debit balance of $3,000, adjustment need to be made for 3,000 - 6,700 = $(3,700) Journal entry: Account Titles and explanation Debit Credit Unrealized loss on trading securities $3,700 Fair value adjustment - Available for sale $3,700

Business

Accounting

Current Attempt in Progress Some of Sunland Corporation's investments in debt securities are classified as trading securities and some are classified as available- for-sale. The cost and fair value of each category at December 31, 2022, were as follows. Cost Fair Value Unrealized Gain (Loss) $95,500 $85,000 $(10,500) Trading securities Available-for-sale securities $59,000 $62,000 $3,000 At December 31, 2021, the Fair Value Adjustment-Trading account had a debit balance of $2,100, and the Fair Value Adjustment- Available-for-Sale account had a credit balance of $6,700. Prepare the required journal entries for each group of securities for December 31, 2022. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts.) No. Account Titles and Explanation Debit Credit Trading securities: 1. Available-for-sale securities: 2.

Current Attempt in Progress Some of Sunland Corporation's investments in debt securities are classified as trading securities and some are classified as available- for-sale. The cost and fair value of each category at December 31, 2022, were as follows. Cost Fair Value Unrealized Gain (Loss) $95,500 $85,000 $(10,500) Trading securities Available-for-sale securities $59,000 $62,000 $3,000 At December 31, 2021, the Fair Value Adjustment-Trading account had a debit balance of $2,100, and the Fair Value Adjustment- Available-for-Sale account had a credit balance of $6,700. Prepare the required journal entries for each group of securities for December 31, 2022. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts.) No. Account Titles and Explanation Debit Credit Trading securities: 1. Available-for-sale securities: 2.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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