Leary Co. bought 3,800 shares of Canada common stock at $38; 640 shares of Chile stock at

Question:

Leary Co. bought 3,800 shares of Canada at $38; 640 shares of Chile stock at $47.25; and 1,500 shares of Milan stock at $77 all as available-for-sale investments. At December 31, Hoovers Online reports Canada stock at $29.125, Chile at $49.25, and Milan at $69.50.

Requirements
1. Determine the cost and the market value of the long-term investment at December 31.
2. Record Leary’s adjusting entry at December 31.
3. What would Leary report on its income statement and for the information given? Make the necessary disclosures. Ignore income tax.

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