Answer:
unrealized loss (OCI) 500 debit
trading securities- wallace 5,200 debit
trading securities gordon 4.200 credit
trading securities - martin 1,600 credit
cash 66,300 debit
loss on investment 6,900 debit
trading securities - gordon 73,200 credit
--to record sale of gordon securties --
trading securities earnhart corp 53,800 debit
cash 53,800 credit
--to record purchase of earnhart--
unrelized loss(OCI) 7,100 debit
trading securities earnhart corp 3,700 credit
trading securities- wallace 3,400 credit
-- 2018 year-end adjustment--
Explanation:
gordon 77,600 - 73,200 = (4,100)
wallace 172,900 - 167,700 = 5,200
martin 63,500 - 65,100 = <u> (1,600) </u>
Total adjustment (500)
We will declare as other comprehensive incoem the unrealized loss of 500 dollar for the period
At sale date we compare the proceeds and the cost to check for the earning or losses:
1,500 shares x $45 each less 1,200 fees = 66,300
gordon shares book value <u>(73,200)</u>
loss on investment 6,900
Earnhart corp:
700 shares x $75 each plus 1,300 fees: 53,800
year-end adjusting 2018
earnhart 50,100 - 53,800 = (3,700)
wallace 61,700 - 65,100 = (3,400)
martin 167,700 - 167,700 = <u> 0</u>
unrealized loss (7,1 00)
