(15 points) Counting Services Inc. has the following portfolio of trading equity
ID: 2513052 • Letter: #
Question
(15 points) Counting Services Inc. has the following portfolio of trading equity securities at 12/31/17. All securities were purchased during 2017. Symbol # shares Total Cost Market Value AAPL 1000 $102,000 115,000 BMX 2000 $47,000 63,000 GNC 3000 $64,000 72,000 Total $213,000 a. Prepare the adjustment necessary at 12/31/17. b. On February 12, 2018, Counting Services sells 1,000 shares of AAPL for $115,000. Prepare the journal entry. c. The total cost of the two remaining securities is $111,000 and the market value is $130,000 at March 31, 2018. Prepare the adjusting entry. (15 points) Counting Services Inc. has the following portfolio of trading equity securities at 12/31/17. All securities were purchased during 2017. Symbol # shares Total Cost Market Value AAPL 1000 $102,000 115,000 BMX 2000 $47,000 63,000 GNC 3000 $64,000 72,000 Total $213,000 a. Prepare the adjustment necessary at 12/31/17. b. On February 12, 2018, Counting Services sells 1,000 shares of AAPL for $115,000. Prepare the journal entry. c. The total cost of the two remaining securities is $111,000 and the market value is $130,000 at March 31, 2018. Prepare the adjusting entry.Explanation / Answer
a) Date Account Titles Debit Credit 12/31/17 Securities Fair Value Adjustment (Trading) $37,000.00 Unrealized Holding Gain or Loss—Income $37,000.00 ($250,000 - $213,000) b) 2/12/2018 Cash $115,000.00 Trading Securities $115,000.00 c) 3/31/2018 Securities Fair Value Adjustment (Trading) $19,000.00 Unrealized Holding Gain or Loss—Income $19,000.00 ($130,000 - $111,000)
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