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Nonamiya [84]
3 years ago
5

On 1/2/20X6, ALPHA acquired 100 shares of CHARLIE Corporation stock at $20 per share, 200 shares of DELTA Corporation stock at $

40 per share, and 100 shares of ECHO Corporation stock at $30 per share. All of these shares were purchased as trading securities. The market price per share of these securities at the end of 20X6 and 20X7, respectively, are:
company 12/31/x6 12/31/x7

charlie $8 $22

delta. $38 $34

echo. $34 $30

What is the balance sheet amount for trading securities at the end of 20x7?
Business
1 answer:
aev [14]3 years ago
7 0

Answer:

The balance sheet amount for trading securities will be 12,000

Explanation:

The trading securities are valued at fair value, their diference through dates will generate Other Comprehensive Income.

For the matter of valuation, the gain/loss is not relevant. We just need to multiply market value with the number of shares to get the total for each company, then we add them to get the total for trading securities.

\left[\begin{array}{cccc}-&shares&market \:price& subtotal\\CHARLIE&100&22&2200\\DELTA&200&34&6800\\ECHO&100&30&3000\\Total&400&-&12000\\\end{array}\right]

The balance sheet amount for trading securities will be 12,000

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