04:b:AL-Sama Company has the following securities in portfolio securities on Dec.31, 2005: Investment Cost Fair value...

 

Transcribed Image Text:

시 04:b:AL-Sama Company has the following securities in portfolio securities on Dec.31, 2005: Investment Cost Fair value 300000 $ 720000 240000 1260000 6000 shares of GM ,common 20000 shares of GTE ,common 1600 shares of CBS, preferred . All of the securities were purchased in 2005. In 2006 the AL-sama com. completed the following security transaction: 276000 $ 700000 246000 1222000 1) Marcg1, sold GM shares at 48 S and paid 4800 fee. 2) April 5, bought 2800 shares DOW, common at 75 $ plus 5200 $ as fee. 3) Dec.31, the fair value of portfolio was GTE common 35 S,DOW 72 $, CBS 14.5 S Required: Prepare the entries for 1) Dec.31, 2005 adjusting 2) 2006 시 04:b:AL-Sama Company has the following securities in portfolio securities on Dec.31, 2005: Investment Cost Fair value 300000 $ 720000 240000 1260000 6000 shares of GM ,common 20000 shares of GTE ,common 1600 shares of CBS, preferred . All of the securities were purchased in 2005. In 2006 the AL-sama com. completed the following security transaction: 276000 $ 700000 246000 1222000 1) Marcg1, sold GM shares at 48 S and paid 4800 fee. 2) April 5, bought 2800 shares DOW, common at 75 $ plus 5200 $ as fee. 3) Dec.31, the fair value of portfolio was GTE common 35 S,DOW 72 $, CBS 14.5 S Required: Prepare the entries for 1) Dec.31, 2005 adjusting 2) 2006

Answer rating: 100% (QA)

Journal Entries in the books of ALSama Company On 31st Dec 2005 1 PL AcDr 38000 Note 2 To Investments Ac 38000 Being Current Investrments Adjusted at the end of the year of 2005 Note 1 Assumed that Investments for the year 2005 are current investments 2 FV of all shares Invested 276000700000246000 1222000 Cost of all shares Invested 30000072000024000 1260000 Difference of reduction transferred to PL Ac FVCost 1222000 1260000 38000 For 2006 1 Bank AcDr 283200 600048 4800 To Investment ... View the full answer