Andrews, Inc., purchased the following securities during 2
Question and Solution
Andrews, Inc., purchased the following securities during 2012:
During 2012, Andrews received interest of $1,400 and dividends of $600 on its investments. On September 29, 2012, Andrews sold one-half of Security 1 for $1,600. On December 31, 2012, the portfolio of securities had the following fair market values: Security Fair Market Value 1 $ 1,700 2 3,600 3 4,000 4 1,900 5 12,000 Andrews had no balance in its market adjustment accounts at the beginning of the year. Prepare the journal entries required to record the purchase of the securities, the receipt of interest and dividends, the sale of securities, and the adjustments required atyear-end.