Question

Paris Enterprises, which began operations in 2013, invests in long- term available-for-sale securities. Following is a series of transactions and events involving its long- term investment activity.
2013
Mar. 10 Purchased 1,200 shares of Apple at $ 25.50 per share plus $ 800 commission.
Apr. 7 Purchased 2,500 shares of Ford at $ 22.50 per share plus $ 1,033 commission.
Sept. 1 Purchased 600 shares of Polaroid at $ 47.00 per share plus $ 890 commission.
Dec. 31 Per share fair values for stocks in the portfolio are: Apple, $27.50; Ford, $21.00; Polaroid, $49.00.
2014
Apr. 26 Sold 2,500 shares of Ford at $ 20.50 per share less a $ 1,207 commission.
June 2 Purchased 1,800 shares of Duracell at $19.25 per share plus a $1,050 commission.
June 14 Purchased 1,200 shares of Sears at $ 21 per share plus a $ 280 commission.
Nov. 27 Sold 600 shares of Polaroid at $ 51 per share less a $ 845 commission.
Dec. 31 Per share fair values for stocks in the portfolio are: Apple, $29.00; Duracell, $18.00; Sears, $23.00.
2015
Jan. 28 Purchased 1,000 shares of Coca-Cola Co. at $40 per share plus a $1,480 commission.
Aug. 22 Sold 1,200 shares of Apple at $ 21.50 per share less a $ 1,850 commission.
Sept. 3 Purchased 3,000 shares of Motorola at $ 28 per share plus a $ 780 commission.
Oct. 9 Sold 1,200 shares of Sears at $ 24.00 per share less a $ 599 commission.
Oct. 31 Sold 1,800 shares of Duracell at $ 15.00 per share less a $ 898 commission.
Dec. 31 Per share fair values for stocks in the portfolio are: Coca-Cola, $48.00; Motorola, $24.00.

Required
1. 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.
2. Prepare a table that summarizes the
(a) Total cost,
(b) Total fair value adjustment
(c) Total fair value for the portfolio of long- term available-for-sale securities at each year-end.
3. Prepare a table that summarizes
(a) The realized gains and losses
(b) The unrealized gains or losses for the portfolio of long-term available-for-sale securities at each year-end.



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  • CreatedNovember 26, 2013
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