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Problem 17-5

Crane Company has the following securities in its investment portfolio on December 31, 2017 (all securities were purchased in 2017): (1) 3,100 shares of Anderson Co. common stock which cost $58,900, (2) 9,900 shares of Munter Ltd. common stock which cost $564,300, and (3) 5,600 shares of King Company preferred stock which cost $229,600. The Fair Value Adjustment account shows a credit of $10,500 at the end of 2017.

In 2018, Crane completed the following securities transactions.

1. On January 15, sold 3,100 shares of Andersons common stock at $23 per share less fees of $2,300.

2. On April 17, purchased 1,000 shares of Castles common stock at $33 per share plus fees of $2,020.

On December 31, 2018, the market prices per share of these securities were Munter $63, King $40, and Castle $20. In addition, the accounting supervisor of Crane told you that, even though all these securities have readily determinable fair values, Crane will not actively trade these securities because the top management intends to hold them for more than one year.

Prepare the entry for the security sale on January 15, 2018. (Credit account titles are automatically inder account titles and enter 0 for the amounts.) Debit Credit Date Account Titles and Explanation Jan. 15, 2018 Prepare the journal entry to record the security purchase on April 17, 2018. (Credit account titles are automa Entry" for the account titles and enter o for the amounts.) Debit Credit Date Account Titles and Explanation Apr. 17, 2018 Compute the unrealized gains or losses. Unrealized Prepare the adjusting entry for Crane on December 31, 2018. (Credit account titles are automatically indented account titles and enter o for the amounts.) Debit Credit Date Account Titles and Explanation Dec 31, 2018

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