Sweet Company has the following investments as of December 31, 2025. $1,350,000 3,390,000 Investments in common stock of Laser Company Investment in debt securities of FourSquare Company In both investments, the carrying value and the fair value of these two investments are the same at December 31, 2025. Sweet's stoc investments do not result in significant influence on the operations of Laser Company. Sweet's debt investment is considered held-to maturity. At December 31, 2026, the shares in Laser Company are valued at $1,060,000; the debt securities of FourSquare are value at $2,530,000 and are considered impaired.
Sweet Company has the following investments as of December 31, 2025. $1,350,000 3,390,000 Investments in common stock of Laser Company Investment in debt securities of FourSquare Company In both investments, the carrying value and the fair value of these two investments are the same at December 31, 2025. Sweet's stoc investments do not result in significant influence on the operations of Laser Company. Sweet's debt investment is considered held-to maturity. At December 31, 2026, the shares in Laser Company are valued at $1,060,000; the debt securities of FourSquare are value at $2,530,000 and are considered impaired.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Sweet Company has the following investments as of December 31, 2025.
Investments in common stock of Laser Company
Investment in debt securities of FourSquare Company
In both investments, the carrying value and the fair value of these two investments are the same at December 31, 2025. Sweet's stock
investments do not result in significant influence on the operations of Laser Company. Sweet's debt investment is considered held-to-
maturity. At December 31, 2026, the shares in Laser Company are valued at $1,060,000; the debt securities of FourSquare are valued
at $2,530,000 and are considered impaired.
(a)
$1,350,000
3,390,000
Prepare the journal entry to record the impairment of the debt securities at December 31, 2026. (List debit entry before credit entry.
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.)
Account Titles and Explanation
Date
Dec. 31.
2026
Debit
Credit
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