Presented below is information related to the purchases of common stock by Larkspur Company during 2025. Investment in Arroyo Company stock Investment in Lee Corporation stock Investment in Woods Inc. stock Total (a) (b) Cost Fair Value (at purchase date) (at December 31) $74,000 $92,000 (b) 265,000 No. Account Titles and Explanation (a) 178,000 $535,000 (Assume a zero balance for any Fair Value Adjustment account at the beginning of 2025.) 312,000 189,000 $575,000 What entry would Larkspur make at December 31, 2025, to record the investment in Arroyo Company stock if it chooses to report this security using the fair value option? What entry would Larkspur make at December 31, 2025, to record the investments in the Lee and Woods corporations, assuming that Larkspur did not select the fair value option for these investments? (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.) Debit Credit
Presented below is information related to the purchases of common stock by Larkspur Company during 2025. Investment in Arroyo Company stock Investment in Lee Corporation stock Investment in Woods Inc. stock Total (a) (b) Cost Fair Value (at purchase date) (at December 31) $74,000 $92,000 (b) 265,000 No. Account Titles and Explanation (a) 178,000 $535,000 (Assume a zero balance for any Fair Value Adjustment account at the beginning of 2025.) 312,000 189,000 $575,000 What entry would Larkspur make at December 31, 2025, to record the investment in Arroyo Company stock if it chooses to report this security using the fair value option? What entry would Larkspur make at December 31, 2025, to record the investments in the Lee and Woods corporations, assuming that Larkspur did not select the fair value option for these investments? (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.) Debit Credit
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Presented below is information related to the purchases of common stock by Larkspur Company during 2025.
Investment in Arroyo Company stock
Investment in Lee Corporation stock
Investment in Woods Inc. stock
Total
(a)
(b)
Cost
(at purchase date)
$92,000
(b)
265,000
No. Account Titles and Explanation
(a)
178,000
$535,000
(Assume a zero balance for any Fair Value Adjustment account at the beginning of 2025.)
Fair Value
(at December 31)
$74,000
312,000
189,000
$575,000
What entry would Larkspur make at December 31, 2025, to record the investment in Arroyo Company stock if it chooses to
report this security using the fair value option?
What entry would Larkspur make at December 31, 2025, to record the investments in the Lee and Woods corporations,
assuming that Larkspur did not select the fair value option for these investments?
(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.)
Debit
Credit
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