50.1K

Verified Solution

Link Copied!

Grass Security, which began operations in 2013, invests in long-term available-for-sale securities. Following is a series of transactions and events determining its long-term investment activity.

2013
Jan.	20		Purchased 1,200 shares of Johnson & Johnson at $20.70 per share plus a $260 commission.
Feb.	9		Purchased 1,400 shares of Sony at $46.40 per share plus a $245 commission.
June	12		Purchased 1,700 shares of Mattel at $27.20 per share plus an $215 commission.
Dec.	31		Per share fair values for stocks in the portfolio are Johnson & Johnson, $21.70; Mattel, $31.10; Sony, $38.20.

2014
Apr.	15		Sold 1,200 shares of Johnson & Johnson at $23.70 per share less a $545 commission.
July	5		Sold 1,700 shares of Mattel at $24.10 per share less a $255 commission.
July	22		Purchased 800 shares of Sara Lee at $22.70 per share plus a $500 commission.
Aug.	19		Purchased 1,100 shares of Eastman Kodak at $17.20 per share plus a $218 commission.
Dec.	31		Per share fair values for stocks in the portfolio are: Kodak, $19.45; Sara Lee, $20.20; Sony, $35.20.

2015
Feb.	27		Purchased 2,600 shares of Microsoft at $67.20 per share plus a $545 commission.
June	21		Sold 1,400 shares of Sony at $48.20 per share less a $900 commission.
June	30		Purchased 1,600 shares of Black & Decker at $36.20 per share plus a $455 commission.
Aug.	3		Sold 800 shares of Sara Lee at $16.45 per share less a $455 commission.
Nov.	1		Sold 1,100 shares of Eastman Kodak at $22.95 per share less a $645 commission.
Dec.	31		Per share fair values for stocks in the portfolio are: Black & Decker, $39.20; Microsoft, $69.20.

Prepare journal entries to record these transactions and events and any year-end fair value adjustments to the portfolio of long-term available-for-sale securities. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Do not round your intermediate calculations.)

2)Prepare a table that summarizes the (a) total cost, (b) total fair value adjustment, and (c) total fair value of the portfolio of long-term available-for-sale securities at each year-end. (Do not round your intermediate calculations.)

3)Prepare a table that summarizes (a) the realized gains and losses and (b) the unrealized gains or losses for the portfolio of long-term available-for-sale securities at each year-end. (Do not round your intermediate calculations. Losses should be indicated by a minus sign.

2. Prepare a table that summarizes the (a) total cost, (b) total fair value adjustment, and (c) total fair value of the portfolio of long-term available-for-sale securities at each year-end. (Do not round your intermediate calculations.) Fair Value Adiustment Computation AFS Long-ter ortfolio Number of Share Price mber 31, 2013 Shares at 12/31/13 Unrealized Gain (Loss) Fair Value Cost J & J Sony Mattel Total 38.20 31.10 0 S Number of Shares Share Price at 12131/14 Unrealized Gain (Loss) ber 31, 2014 Fair Value Cost Kodak Sara Lee Sony Total 20.20 35.20 Number of Shares Share Price at 12/31/15 at 12/31/15 Unrealized Gain (Loss) mber 31, 2015 Fair Value Cost Black & Decker Microsoft Total 39.20 69.20 0 S 2013 2014 2015 alance Sheet Presentation: Long-Term AFS Securities (Cost) Fair Value Adjustment Long-Term AFS Securities (Fair Value) 0 S 3. Prepare a table that summarizes (a) the realized gains and losses and (b) the unrealized gains or losses for the portfolio of long-term available-for-sale securities at each year-end. (Do not round your intermediate calculations. Losses should be indicated by a minus sign.) ealiz ain 2013 2014 2015 Sale of Johnson & Johnson shares Sale of Mattel shares Sale of Sara Lee shares Sale of Sony shares Sale of Eastman Kodak shares Realized Gains (Losses) 0 $ 0 $ nrealiz Gains (Los 2013 2014 2015 Balance in the Fair Value Adjustment AFS account Beginning of year Debit (Credit) Required balance End of year Debit (Credit) Required adjustment Unrealized Gain (Loss)

Answer & Explanation Solved by verified expert

See Answer