On December 21, 2012, Zurich Company provided you with the following information regarding its trading securities.
| December 31, 2012 |
| Investments (Trading) |
|
Cost |
|
Fair Value |
|
Unrealized Gain (Loss) |
| Stargate Corp. stock |
|
$23,880 |
|
$22,880 |
|
$(1,000 |
) |
| Carolina Co. stock |
|
12,840 |
|
11,840 |
|
(1,000 |
) |
| Vectorman Co. stock |
|
23,880 |
|
24,440 |
|
560 |
|
| Total of portfolio |
|
$60,600 |
|
$59,160 |
|
(1,440 |
) |
| Previous fair value adjustment balance |
|
|
|
|
|
0 |
|
| Fair value adjustment Cr. |
|
|
|
|
|
$(1,440 |
) |
During 2013, Carolina Company stock was sold for $12,520. The fair value of the stock on December 31, 2013, was: Stargate Corp. stock $23,150; Vectorman Co. stock $24,310.
| (a) |
|
Prepare the adjusting journal entry needed on December 31, 2012. |
| (b) |
|
Prepare the journal entry to record the sale of the Carolina Company stock during 2013. |
| (c) |
|
Prepare the adjusting journal entry needed on December 31, 2013. |
(Credit account titles are automatically indented when amount is entered. Do not indent manually.)
| No. |
Account Titles and Explanation |
Debit |
Credit |
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| (b) |
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| (c) |
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List Of Accounts
Bonds Payable
Call Option
Cash
Cost of Goods Sold
Debt Investments
Dividend Receivable
Dividend Revenue
Equity Investments
Fair Value Adjustment
Futures Contract
Gain on Sale of Investments
Interest Expense
Interest Receivable
Interest Revenue
Inventory
Investments
Loss on Impairment
Loss on Investments
Loss on Settlement of Call Option
Loss on Settlement of Put Option
Memo Entry
No Entry
Notes Payable
Put Option
Retained Earnings
Revenue from Investment
Sales Revenue
Swap Contract
Unrealized Holding Gain or Loss – Equity
Unrealized Holding Gain or Loss – Income |
|
