Question

Tolland Financial began operators in 2012 and invests in securities classified as available-for-sale. During 2012, it entered into the following available-for-sale security transactions:
Purchased 10,000 shares of DTR common stock at $ 50 per share
Purchased 44,000 shares of MJO common stock at $ 22 per share
At December 31, 2012, DTR common stock was trading at $ 62 per share and MJO common stock was trading at $ 21 per share.
Required:
1. Prepare the necessary adjusting entry to value the available-for-sale securities at fair market value.
2. What is the income statement effect of this adjusting entry?


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  • CreatedSeptember 22, 2015
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