The cost and fair value of non-strategic investments of International Journalist Corporation on December 31, 2017,...
The cost and fair value of non-strategic investments of
International Journalist Corporation on December 31, 2017, and
December 31, 2018, are as follows:
| Cost | Fair Value | |
| On December 31, 2017 | $23,500 | $22,000 |
| On December 31, 2018 | 26,500 | 27,350 |
Required:
1. Prepare the fair value adjustment at December 31, 2017,
and December 31, 2018, based on the information provided.
(If no entry is required for a transaction/event, select
"No journal entry required" in the first account
field.)
2. Illustrate how the non-strategic investments
will be reported on the December 31, 2017, and December 31, 2018,
balance sheets.
Homework Answers
1.the fair value adjustment at December 31, 2017, and December 31, 2018, based on the information provided -
| Dec 31 2017 | ||
| Investments | ||
| Investments in securities | $23,500 | |
| Less: fair value adjustments | ($1,500) | $22,000 |
| Dec 31 2018 | ||
| Investments | ||
| Investments in securities | $26,500 | |
| Add - : fair value adjustments | $850 | $27,350 |
2. how the non-strategic investments will be reported on the December 31, 2017, and December 31, 2018, balance sheets-
cost or fair market value, which ever is lower is recorded in balance sheet
the investments will be reported on the December 31, 2017 in balance sheet at fair value - $22,000
the investments will be reported on the December 31, 2017 in balance sheet at costvalue - $26,500
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