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Unrealized Gains | Accounting homework help

Storm, Inc. purchased the following available-for-sale securities during 20Y9, its first year of operations:

NameNumber of SharesCost
Dust Devil, Inc.1,100$31,680
Gale Co.500$35,050
Whirlwind Co.6,100$65,100
Total$131,830

The market price per share for the available-for-sale security portfolio on December 31, 20Y9 was as follows:

Market Price per Share Dec 31, 2016
Dust Devil, Inc.$31
Gale Co.$76
Whirlwind Co.$30

a. Provide the journal entry to adjust the available-for-sale security portfolio to fair value on December 31, 20Y9.

b. Is there any impact of the December 31, 20Y9 journal entry on the income statement?

Solution:

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