In its first year of operations, DeMarco Company had the following selected transactions in stock investments that are considered trading securities.
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June 1 |
Purchased for cash 600 shares of Sanburg common stock at $24 per share, plus $300 brokerage fees. |
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July 1 |
Purchased for cash 800 shares of Cey common stock at $33 per share, plus $600 brokerage fees. |
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Sept. 1 |
Received a $1 per share cash dividend from Cey Corporation. |
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Nov. 1 |
Sold 200 shares of Sanburg common stock for cash at $27 per share, less $150 brokerage fees. |
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Dec. 15 |
Received a $0.50 per share cash dividend on Sanburg common stock. |
At December 31, the fair values per share were: Sanburg $25 and Cey $30.
Instructions
(a) Journalize the transactions.
(b) Prepare the adjusting entry at December 31 to report the securities at fair value.