Fair Value Journal Entries, Available-for-Sale Investments The investments of Steelers Inc. include a single investment:...
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Fair Value Journal Entries, Available-for-Sale Investments
The investments of Steelers Inc. include a single investment: 10,900 shares of Bengals Inc. common stock purchased on September 12, Year 1, for $11 per share including brokerage commission. These shares were classified as available-for-sale securities. As of the December 31, Year 1, balance sheet date, the share price declined to $8 per share.
a. Journalize the entries to acquire the investment on September 12 and record the adjustment to fair value on December 31, Year 1.
Year 1 Sept. 12
Investments-Bengals Inc. Stock (_________)
Cash (_________)
Year 1 Dec. 31
Unrealized Gain (Loss) on Available-for-Sale Investments
(_________)
Valuation Allowance for Available-for-Sale Investments
(___________)
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