E16.15 (LO 2) (Equity Investments) Kenseth Company has the following securities in its portfolio on December 31, 2025. None of these investments are accounted for under the equity method. Investments 1,500 shares of Gordon, Inc., common 5,000 shares of Wallace Corp., common 400 shares of Martin, Inc., preferred Fair Value Cost $ 73,500 $ 69,000 175,000 61,600 $305,600 180,000 60,000 $313,500 All of the securities were purchased in 2025. In 2026, Kenseth completed the following securities transactions. March 1Sold the 1,500 shares of Gordon, Inc., common, @ $45 less fees of $1,200. April 1 Bought 700 shares of Earnhart Corp., common, @ $75 plus fees of $1,300. Kenseth's portfolio of equity securities appeared as follows on December 31, 2026. Instructions Prepare the general journal entries for Kenseth Company for: a. The 2025 adjusting entry. b. The sale of the Gordon stock. c. The purchase of the Earnhart stock. d. The 2026 adjusting entry for the portfolio. Investments 5,000 shares of Wallace Corp., common 700 shares of Earnhart Corp., common Cost $180,000 Fair Value $175,000 53,800 50,400 400 shares of Martin, Inc., preferred 60,000 58,000 $293,800 $283,400
E16.15 (LO 2) (Equity Investments) Kenseth Company has the following securities in its portfolio on December 31, 2025. None of these investments are accounted for under the equity method. Investments 1,500 shares of Gordon, Inc., common 5,000 shares of Wallace Corp., common 400 shares of Martin, Inc., preferred Fair Value Cost $ 73,500 $ 69,000 175,000 61,600 $305,600 180,000 60,000 $313,500 All of the securities were purchased in 2025. In 2026, Kenseth completed the following securities transactions. March 1Sold the 1,500 shares of Gordon, Inc., common, @ $45 less fees of $1,200. April 1 Bought 700 shares of Earnhart Corp., common, @ $75 plus fees of $1,300. Kenseth's portfolio of equity securities appeared as follows on December 31, 2026. Instructions Prepare the general journal entries for Kenseth Company for: a. The 2025 adjusting entry. b. The sale of the Gordon stock. c. The purchase of the Earnhart stock. d. The 2026 adjusting entry for the portfolio. Investments 5,000 shares of Wallace Corp., common 700 shares of Earnhart Corp., common Cost $180,000 Fair Value $175,000 53,800 50,400 400 shares of Martin, Inc., preferred 60,000 58,000 $293,800 $283,400
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:E16.15 (LO 2) (Equity Investments) Kenseth Company has the following securities in its portfolio on December 31, 2025. None of these investments are accounted for under the equity method.
Investments
1,500 shares of Gordon, Inc., common
5,000 shares of Wallace Corp., common
400 shares of Martin, Inc., preferred
Fair Value
Cost
$ 73,500
$ 69,000
175,000
61,600
$305,600
180,000
60,000
$313,500
All of the securities were purchased in 2025.
In 2026, Kenseth completed the following securities transactions.
March 1Sold the 1,500 shares of Gordon, Inc., common, @ $45 less fees of $1,200.
April 1 Bought 700 shares of Earnhart Corp., common, @ $75 plus fees of $1,300.
Kenseth's portfolio of equity securities appeared as follows on December 31, 2026.
Instructions
Prepare the general journal entries for Kenseth Company for:
a. The 2025 adjusting entry.
b. The sale of the Gordon stock.
c. The purchase of the Earnhart stock.
d. The 2026 adjusting entry for the portfolio.
Investments
5,000 shares of Wallace Corp., common
700 shares of Earnhart Corp., common
Cost
$180,000
Fair Value
$175,000
53,800
50,400
400 shares of Martin, Inc., preferred
60,000
58,000
$293,800
$283,400
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