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What is the effect of the sale of the a corporation shares

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Reference no: EM13996175

The investments of Harlon Enterprises included the following cost and fair value amounts:
Harlon Enterprises sold its holdings of A Corporation shares on June 1, 2012, for $15 million. On September 12, it purchased the C Corporation shares.

Required:

1. What is the effect of the sale of the A Corporation shares and the purchase of the C Corporation shares on Harlon's 2012 pretax earnings?

2. At what amount should Harlon's securities available-for-sale portfolio be reported in its 2012 balance sheet? What adjusting entry is needed to accomplish this? What is the effect of the adjustment on Harlon's 2012 pretax earnings?

Reference no: EM13996175

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