**Available-for-Sale Securities at Fair Value**On January 1, 20Y7, the Valuation Allowance for Available-for-Sale Investments had a zero balance. On December 31, 20Y7, the cost of the available-for-sale securities was $189,000, and the fair value was $194,170.Journalize the adjusting entry to record the unrealized gain or loss on available-for-sale investments on December 31. If an amount box does not require an entry, leave it blank.**Journal Entry on Dec. 31:**- [Debit/Credit selection box]- [Amount entry box]- [Debit/Credit selection box]- [Amount entry box]The task involves determining the unrealized gain or loss and making a journal entry to reflect this change in valuation. The unrealized gain is the difference between the fair value and the cost of the securities.

Unrealized Gain = Fair value of investment - Cost of investment = $194,170 - 189,000 = $5,170

Answered: On January 1, 20Y7, Valuation Allowance…

FINANCIAL ACCOUNTING

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ISBN:9781259964947

Author:Libby

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Chapter1: Financial Statements And Business Decisions

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Year 2 and 3 for Fair Value at the end of the year are still incorrect and I do not understand why?
On December 31, Reggit Company held the following short-term investments in its portfolio of available-for-sale debt securities. Reggit had no short-term investments in its prior accounting periods. Available-for-Sale Securities Verrizano Corporation bonds Preble Corporation notes Lucerne Company bonds epare the December 31 adjusting entry to report these investments at fair value. Fair Value Adjustment Computation of fair value adjustment. Complete this question by entering your answers in the tabs below. General Journal Cost $ 76,000 57,000 72,000 Verrizano Corporation bonds Preble Corporation notes Lucerne Company bonds Total Fair Value Adjustment Computation - Available for Sale Portfolio Unrealized Amount Cost $ Fair Value $ 74,480 50,730 69,120 Fair Value 76,000 $ 74,480 57,000 50,730 72,000 69,120 $ 205,000 $ 194,330 CO
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