Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. at the beginning of 2019, able company had the fol

At the beginning of 2019, Able Company had the following portfolio of investments in trading...

70.2K

Verified Solution

Question

Accounting

At the beginning of 2019, Able Company had the following portfolio of investments in trading securities (all of which were acquired at par value):
Security Cost 1/1/2019 Fair Value
A $20,000 $25,000
B 30,00029,000
Totals $50,000 $54,000
During 2019, the following transactions occurred:
May 3 Purchased C debt securities at their par value for $50,000.
July 1 Sold all of the A securities for $27,000 plus interest of $1,000.
Dec. 31 Received interest of $7,600 on the B and C securities. Additionally the following information was available:
12/31/2019
Security
Fair Value
B $29,000
C 52,500
Required:
1. Prepare journal entries to record the preceding information.
2. Next Level What justification does the FASB give for its treatment of unrealized holding gains and losses for trading securities?

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students