(b) Prepare the adjusting entry at December 31, 2022, to report the investment securities at fair value. All securities are considered to be trading securities. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Dec. 31 Debit Credit In January 2022, the management of Sheridan Company concludes that it has sufficient cash to permit some short-term investments in debt and equity securities. During the year, the following transactions occurred. Feb. 1 Purchased 600 shares of Muninger common stock for $30,000. Mar. 1 Purchased 800 shares of Tatman common stock for $20,000. Apr. 1 Purchased 60 of $1,160,7% Yoakem bonds for $69,600. Interest is payable semiannually on April 1 and October 1. July 1 Received a cash dividend of $0.70 per share on the Muninger common stock. Aug. 1 Sold 200 shares of Muninger common stock at $65 per share. Sept. 1 Received a $1 per share cash dividend on the Tatman common stock. Oct. 1 Received the semiannual interest on the Yoakem bonds. Oct. 1 Sold the Yoakem bonds for $67,900. At December 31, the fair value of the Muninger and Tatman common stocks were $51 and $24 per share respectively. These stock investments by Sheridan Company provide less than a 20% ownership interest.
(b) Prepare the adjusting entry at December 31, 2022, to report the investment securities at fair value. All securities are considered to be trading securities. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Dec. 31 Debit Credit In January 2022, the management of Sheridan Company concludes that it has sufficient cash to permit some short-term investments in debt and equity securities. During the year, the following transactions occurred. Feb. 1 Purchased 600 shares of Muninger common stock for $30,000. Mar. 1 Purchased 800 shares of Tatman common stock for $20,000. Apr. 1 Purchased 60 of $1,160,7% Yoakem bonds for $69,600. Interest is payable semiannually on April 1 and October 1. July 1 Received a cash dividend of $0.70 per share on the Muninger common stock. Aug. 1 Sold 200 shares of Muninger common stock at $65 per share. Sept. 1 Received a $1 per share cash dividend on the Tatman common stock. Oct. 1 Received the semiannual interest on the Yoakem bonds. Oct. 1 Sold the Yoakem bonds for $67,900. At December 31, the fair value of the Muninger and Tatman common stocks were $51 and $24 per share respectively. These stock investments by Sheridan Company provide less than a 20% ownership interest.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:(b)
Prepare the adjusting entry at December 31, 2022, to report the investment securities at fair value. All securities are considered
to be trading securities. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is
entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts.)
Date
Account Titles and Explanation
Dec. 31
Debit
Credit
Transcribed Image Text:In January 2022, the management of Sheridan Company concludes that it has sufficient cash to permit some short-term investments
in debt and equity securities. During the year, the following transactions occurred.
Feb. 1
Purchased 600 shares of Muninger common stock for $30,000.
Mar. 1
Purchased 800 shares of Tatman common stock for $20,000.
Apr. 1
Purchased 60 of $1,160,7% Yoakem bonds for $69,600. Interest is payable semiannually on April 1 and October 1.
July 1
Received a cash dividend of $0.70 per share on the Muninger common stock.
Aug. 1
Sold 200 shares of Muninger common stock at $65 per share.
Sept. 1
Received a $1 per share cash dividend on the Tatman common stock.
Oct. 1
Received the semiannual interest on the Yoakem bonds.
Oct. 1
Sold the Yoakem bonds for $67,900.
At December 31, the fair value of the Muninger and Tatman common stocks were $51 and $24 per share respectively. These stock
investments by Sheridan Company provide less than a 20% ownership interest.
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