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In: Accounting

Question No. 03: Sun Corporation's trading portfolio of stock investments consisted of the following on December...

Question No. 03:

Sun Corporation's trading portfolio of stock investments consisted of the following on December 31, 2019:

Stock Number of Shares Cost

Can Common Stock 200 $30,000

Ares Preferred Stock 300 9,000

Han Common Stock 500 10,000

$43,000

During 2019, the following transactions took place:

Feb. 5 Sold 100 shares of Can common stock for $20,000.

Mar. 30 Purchased 75 shares of Han common stock for $20 per share.

Sept. 9 Sold 275 shares of Han common stock for $8,250.

At year-end on December 31, 2019, the fair values per share were:

Fair Value Per Share

Can Common Stock $160

Ares Preferred Stock $25

Han Common Stock $25

Instructions

(a) Prepare the journal entries to record the 2019 stock transactions.

(b) On December 31, 2019, prepare any adjusting entry that might be necessary relative to the trading portfolio.

(c) Show how the stock investments will appear on Sun Corporation's balance sheet on December 31, 2019.

Expert Solution

ekkarill92 answered 2 years ago

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