Data for debt investments are presented in EH.6. Assume instead that the investments are classified as available-for-sale debt securities with the same cost and fair value data as indicated in EH.6. The securities are considered to be a long-term investment.?

Instructions?

a. Prepare the adjusting entry at December 31, 2022, to report the securities at fair value.?

b. Show the statement presentation at December 31, 2022, after adjustment to fair value.?

c. Pam Jenks, a member of the board of directors, does not understand the reporting of the unrealized gains or losses on trading debt securities and available-for-sale debt securities. Write a letter to Ms. Jenks explaining the reporting and the purposes it serves.?

Data from EH.6

At December 31, 2022, the trading debt securities for Gwynn, Inc. are as follows.?

Transcribed Image Text:

Fair Value Cost Security $18,100 $16,000 A 12,500 14,800 18,000 Total $53,600 $48,800