Assignment Information: Problem 1: The Janjua Company
Assignment Information:
Problem 1:
The Janjua Company had the following account balances at 1/1/16:
Common Stock | $75,000 |
Treasury Stock (at cost) | 15,000 |
Paid-in-Capital in Excess of Par | 150,000 |
Investments in AFS Equity Securities | 35,000 |
FVA (AFS) | 1,500 debit |
Retained Earnings | 25,000 |
There were no sales or purchases of Common Stock or Investments during 2016. Prior to any adjusting journal entries related to the investments, 2016 Net Income was $7,600. No other transactions affecting Retained Earnings occurred. Fair Value of the Investments at 12/31/2016 was $33,700.
On 1/1/16, the Accumulated OCI account was at its proper balance.
REQUIRED:
a) Prepare the 12/31/16 journal entry to adjust the investment to fair value.
b) Prepare the 12/31/16 Equity section of the balance sheet.
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Rating:
/5
Solution: Assignment Information: Problem 1: The Janjua Company