At January 1, 2012, the available-for-sale securities portfolio held by Darin Co

Question

At January 1, 2012, the available-for-sale securities portfolio held by Darin Corporation consisted of the following investments: 2,500 shares of Hacker common stock purchased for $42 per share. 1,500 shares of Kramer common stock purchased for $50 per share. At December 31, 2012, the fair values per share were Hacker $36 and Kramer $54. Prepare a schedule showing the cost and fair value of the portfolio at December 31, 2012. Prepare the adjusting entry to report the portfolio at fair value at December 31, 2012

Explanation / Answer

Stock No of shares purchase price Purchase cost Fair Price on Dec31. Fair value Dec31. Unrealized Gain /(Loss) Hacker              2,500                   42    105,000               36      90,000    (15,000) Kramer              1,500                   50      75,000               54      81,000         6,000 Total    180,000    171,000      (9,000) Fair Value Adjustment entry Dec 31.2012. Date Account Title Dr $ Cr $ Dec 31.2012. Investment in Hacker           15,000 Investment in Kramer              6,000 Unrealized Holding Gain/(Loss) on Available for sale security (OCI)             6,000 Unrealized Holding Gain/(Loss) on Available for sale security (OCI)            15,000

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.