During Year 1, Rosie Company purchased 8,000 shares of Company A common stock for $30 per share and 5,000 shares of Company B common stock for $50 per share These investments are classified as available for sale securities At December 31, Year 1, Rosie Company appropriately recorded a $100,000 debi...

1 Mar 23 Cash 8000 X 47 376000 Realized Gain on AvailableforSale Securities 136000 Investment Securi ...

During Year 1, Rosie Company purchased 8,000 shares of Company A common stock for $30 per share

Question:

During Year 1, Rosie Company purchased 8,000 shares of Company A for $30 per share and 5,000 shares of Company B for $50 per share. These investments are classified as available-for-sale securities. At December 31, Year 1, Rosie Company appropriately recorded a $100,000 debit to Market Adjustment—Available-for- Sale Securities. On March 23, Year 2, the 8,000 shares of Company A were sold for $47 per share. The market value of the Company B shares on December 31, Year 2, was $55 per share.
(1) Prepare all journal entries needed in Year 2 related to these securities.
(2) Compute the total increase in economic value generated by Rosie’s stock during Year 2.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Portfolio
A portfolio is a grouping of financial assets such as stocks, bonds, commodities, currencies and cash equivalents, as well as their fund counterparts, including mutual, exchange-traded and closed funds. A portfolio can also consist of non-publicly...