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Problem 15-4A (Algo) Recording, adjusting, and reporting stock investments with insignificant influence LO P4 [The following information applies to the questions displayed below.] Rose Company had no short-term investments prior to this year. It had the following transactions this year involving shortterm stock investments with insignificant influence. April16July7July20August15August28Sold3,000sharesofGemCompanystockat$30.50pershare.October1Receiveda$1.70persharecashdividendonthePepsiCoshares.December15Receiveda$0.95persharecashdividendontheremainingGemCompanyshares.ecember31Receiveda$1.35persharecashdividendonthePepsiCoshares.Purchased6,000sharesofGemCompanystockat$23.75pershare.Purchased3,000sharesofPepsiCostockat$49.00pershare.Purchased1,500sharesofXeroxstockat$18.00pershare.Receiveda$0.80persharecashdividendontheGemCompanystock. April 16 Purchased 6,000 shares of Gem Company stock at $23.75 per share. July 7 Purchased 3,000 shares of Pepsico stock at $49.00 per share. July 20 Purchased 1,500 shares of Xerox stock at $18.00 per share. August 15 Received a $0.80 per share cash dividend on the Gem Company stock. August 28 Sold 3,000 shares of Gem Company stock at $30.50 per share. October 1 Received a $1.70 per share cash dividend on the Pepsico shares. December 15 Received a $0.95 per share cash dividend on the remaining Gem Company shares. December 31 Received a \$1.35 per share cash dividend on the Pepsico shares. The year-end fair values per share are Gem Company, $26.00; PepsiCo, $46.25; and Xerox, $15.00. Problem 15-4A (Algo) Part 1 Required: 1. Prepare journal entries to record the preceding transactions and events. 2. Prepare a table to compare the year-end cost and fair values of Rose's short-term stock investments. 3. Prepare an adjusting entry to record the year-end fair value adjustment for the portfolio of short-term stock investments. Journal entry worksheet Record the year-end adjusting entry for the securities portfolio. Note: Enter debits before credits. 4. Prepare the current asset section of the balance sheet for the fair value adjustment for Rose's short-term investments. Note: Amounts to be deducted should be entered with a minus sign. 5. Identify the dollar increase or decrease from Rose's short-term stock investments on (a) its income statement for this year and (b) the equity section of its balance sheet at this year-end

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