Reference no: EM13895232
Stoll Co.' s long term available for sale portfolio at December 31, 2012, consists of the following.
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Stoll enters into the following long term investment transactions during year 2013.
Jan. 29 Sold 3,500 shares of Company B common stock for $ 79,188 less a brokerage fee of $ 1,500.
Apr. 17 Purchased 10,000 shares of Company W common stock for $ 197,500 plus a brokerage fee of $ 2,400. The shares represent a 30% ownership in Company W.
July 6 Purchased 4,500 shares of Company X common stock for $ 126,562 plus a brokerage fee of $ 1,750. The shares represent a 10% ownership in Company X.
Aug. 22 Purchased 50,000 shares of Company Y common stock for $ 375,000 plus a brokerage fee of $ 1,200. The shares represent a 51% ownership in Company Y.
Nov. 13 Purchased 8,500 shares of Company Z common stock for $ 267,900 plus a brokerage fee of $ 2,450. The shares represent a 5% ownership in Company Z.
Dec. 9 Sold 40,000 shares of Company A common stock for $ 515,000 less a brokerage fee of $ 4,100.
The fair values of its investments at December 31, 2013, are: B, $ 81,375; C, $ 610,312; W, $ 191,250; X, $ 118,125; Y, $ 531,250; and Z, $ 278,800.
Required:
1. Determine the amount Stoll should report on its December 31, 2013, balance sheet for its long term investments in available for sale securities.
2. Prepare any necessary December 31, 2013, adjusting entry to record the fair value adjustment for the long term investments in available for sale securities.
3. What amount of gains or losses on transactions relating to long term investments in available for sale securities should Stoll report on its December 31, 2013, incomestatement?