Explanation:
The journal entries are as follows
a. Unrealized Holding Gain or Loss Dr $1,310
To Fair value Adjustment $1,310
(Being the unrealized gain or loss is recorded)
2. Cash $9,410
Loss on Sale of Investment $490 ($9,900 - $9,410)
To Equity Investment $9,900
(Being the sale of the stock is recorded)
3. Fair value Adjustment $1,020
To Unrealized Holding Gain or Loss $1,020
(Being the fair value adjustment is recorded)
The computation is shown below:
Stock Cost Fair Value Unrealized Gain(Loss)
Clemson Corp. Stock $20,200 $19,410 -$790
Buffaloes Co. stock $20,200 $20,700 $500
Net unrealized gain (loss) -$290
2017 -$1,310
Fair value adjustment -$1,020
