Information related to Jones Companys portfolio of trading securities at December 31, 20X1, follows: Amortized cost of
Question:
Information related to Jones Company’s portfolio of trading securities at December 31, 20X1, follows:
Amortized cost of securities ........................ $340,000
Gross unrealized gains (cumulative) ................ 8,000
Gross unrealized losses (cumulative) ............ 52,000
Jones reported a $10,000 credit balance in its Fair value adjustment trading securities account in its December 31, 20X0, balance sheet. Assume that it sold no trading securities during 20X1.
Required:
1. How much should Jones report as unrealized gain or loss on its 20X1 income statement?
2. Prepare the journal entry that Jones would make to record the 20X1 fair value adjustment to its trading portfolio.
Step by Step Answer:
Financial Reporting And Analysis
ISBN: 9781260247848
8th Edition
Authors: Lawrence Revsine, Daniel Collins, Bruce Johnson, Fred Mittelstaedt, Leonard Soffer