Fair value adjustment for available-for-sale investmentsM. Jones Inc. purchased the following available-for-sale securities during 20Y5, its first year of operations:Issuing CompanyArden Enterprises Inc.French Broad Industries Inc.Pisgah Construction Inc.$150,00066,000104,000$320,000The fair value of the various available-for-sale securities on December 31, 20Y5, was as follows:Fair Value,Dec. 31, 20Y5Issuing CompanyArden Enterprises Inc.French Broad Industries Inc.CostPisgah Construction Inc.$168,00072,00097,000$337,000 d. If the fair value of the portfolio of securities was $330,000 on December 31, 20Y6, what would be the journalentry to adjust the portfolio to fair value? If an amount box does not require an entry, leave it blank. If no entry isrequired, select "No Entry Required" and leave the amount boxes blank.20Y6 Dec. 31 Unrealized Loss on Available-for-Sale InvestmentsValuation Allowance for Available-for-Sale Investments7,000 X7,000 X

A journal entry is a chronological record of a transaction or occurrence made in a journal or…

Fair value adjustment for available-for-sale investments M. Jones Inc. purchased the following available-for-sale securities during 20Y5, its first year of operations: Issuing Company Arden Enterprises Inc. French Broad Industries Inc. Pisgah Construction Inc. Cost Issuing Company Arden Enterprises Inc. French Broad Industries Inc. Pisgah Construction Inc. $150,000 66,000 104,000 $320,000 The fair value of the various available-for-sale securities on December 31, 20Y5, was as follows: Fair Value, Dec. 31, 20Y5 $168,000 72,000 97,000 $337,000

Fair value adjustment for available-for-sale investments M. Jones Inc. purchased the following available-for-sale securities during 20Y5, its first year of operations: Issuing Company Arden Enterprises Inc. French Broad Industries Inc. Pisgah Construction Inc. Cost Issuing Company Arden Enterprises Inc. French Broad Industries Inc. Pisgah Construction Inc. $150,000 66,000 104,000 $320,000 The fair value of the various available-for-sale securities on December 31, 20Y5, was as follows: Fair Value, Dec. 31, 20Y5 $168,000 72,000 97,000 $337,000

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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Valuing Available-for-Sale Securities at Fair Value On January 1, Valuation Allowance for Available-for-Sale Investments had a zero balance. On December 31, the cost of the available-for-sale securities was $216,000, and the fair value was $221,900. Prepare the adjusting entry to record the unrealized gain or loss on available-for-sale investments on December 31.
Record any reclassification adjustment.
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