Required information

Use the following information for the Quick Study below. (Algo)

[The following information applies to the questions displayed below.] On December 31, Reggit Company held the following short-term investments in its portfolio of available-for-sale debt securities. Reggit had no short-term investments in its prior accounting periods.

Available-for-Sale Securities	Cost	Fair Value
Verrizano Corporation bonds	$ 74,000	$ 72,520
Preble Corporation notes	55,000	48,950
Lucerne Company bonds	70,000	67,200

QS 15-9 (Algo) Adjusting available-for-sale debt securities to fair value LO P3

Prepare the December 31 adjusting entry to report these investments at fair value.

a.

Fair Value Adjustment

General Journal

Computation of fair value adjustment.

Fair Value Adjustment Computation - Available for Sale Portfolio
	Cost	Fair Value	Unrealized Amount
Verrizano Corporation bonds	$74,000	$72,520
Preble Corporation notes	55,000	48,950
Lucerne Company bonds	70,000	67,200
Total	$199,000	$188,670		Unrealized Loss

b. Journal entry worksheet Record the year-end adjusting entry for the securities portfolio.