Last Unguaranteed Financial Inc. purchased the following trading securities during Year 1, its first year of operations:

Name	Number of shares	Cost
arden companies inc.	4,800	$ 134,400
French Broad Industries Inc.	2,660	58,520
Pisgah Construction Inc.	1,670	106,880
Total		$299,800

The market price per share of the negotiable securities portfolio as of December 31 of year 1 was as follows:

	Market price
	per share,
	December 31, year 1
arden companies inc.	$34
French Broad Industries Inc.	27
Pisgah Construction Inc.	60

Required:

A.	Provide the journal entry to adjust the portfolio of trade securities to fair value on December 31, Year 1.
B.	Assume that the market prices of the portfolio were the same on December 31 of year 2 as they were on December 31 of year 1. What would be the journal entry to adjust the portfolio to fair value?

Answer rating: 100% (QA)

A To adjust the portfolio of trading securities to fair value on December 31 Year 1 you would need t... View the full answer