Question: Can someone help with adjusting entries? Prepare the adjusting entry at December 31, 2022, to report the investment securities at fair value. All securities are

Can someone help with adjusting entries?

Can someone help with adjusting entries? Prepare the adjusting entry at December31, 2022, to report the investment securities at fair value. All securitiesare considered to be trading securities. (List all debit entries before creditentries. Credit account titles are automatically indented when amount is entered. Do

Prepare the adjusting entry at December 31, 2022, to report the investment securities at fair value. All securities are considered to be trading securities. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31In January 2022, the management of Pharoah Company concludes that it has sufficient cash to permit some short-term investments in debt and equity securities. During the year, the following transactions occurred. Feb. 1 Purchased 500 shares of Muninger common stock for $25,000. Mar. 1 Purchased 700 shares of Tatman common stock for $17,500. Apr. 1 Purchased 70 of $1,020, 8% Yoakem bonds for $71,400. Interest is payable semiannually on April 1 and October 1. July 1 Received a cash dividend of $0.60 per share on the Muninger common stock. Aug. 1 Sold 167 shares of Muninger common stock at $60 per share. Sept. 1 Received a $1 per share cash dividend on the Tatman common stock. Oct. 1 Received the semiannual interest on the Yoakem bonds. Oct. 1 Sold the Yoakem bonds for $70,200. At December 31, the fair value of the Muninger and Tatman common stocks were $51 and $24 per share respectively. These stock investments by Pharoah Company provide less than a 20% ownership interest.Date Account Titles and Explanation Debit Credit Feb. 1 Stock Investments 25,000 Cash 25,000 Mar. 1 Stock Investments 17,500 Cash 17,500 Apr. 1 v Debt Investments 71,400 Cash 71,400 July 1 Cash 300 Dividend Revenue 300 Aug. 1 Cash 10,020 Stock Investments 8,350 Gain on Sale of Stock Investments 1,670 Sept. 1 Cash 700 Dividend Revenue 700Oct. 1 Cash 2,856 Interest Revenue 2,856 (To record the receipt of semiannual interest on Yoakem bonds) Oct. 1 Cash 70,200 Loss on Sale of Debt Investments 1,200 Debt Investments 71,400 (To record the sale of Yoakem bonds) Stock Investments Feb. 1 25,000 Aug. 1 8,350 Mar. 1 17,500 Dec. 31 Bal. 34,150 Debt Investments Apr. 1 71,400 Oct. 1 71,400 Dec. 31 Bal

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!