Question

P12-3A Journalize transactions and adjusting entry for stock investments. On December 31, 2015, Turnball Associates owned...

P12-3A Journalize transactions and adjusting entry for stock investments.
On December 31, 2015, Turnball Associates owned the following securities, held as a long-term
investment. The securities are not held for influence or control of the investee.
Common Stock Shares Cost
Gehring Co. 2,000 $60,000
Wooderson Co. 5,000 45,000
Kitselton Co. 1,500 30,000
On December 31, 2015, the total fair value of the securities was equal to its cost. In 2016,
the following transactions occurred.
July 1 Received $1 per share semiannual cash dividend on Wooderson Co. common stock.
Aug. 1 Received $0.50 per share cash dividend on Gehring Co. common stock.
Sept. 1 Sold 1,500 shares of Wooderson Co, common stock for cash at $8 per share.
Oct. 1 Sold 800 shares of Gehring Co. common stock for cash at $33 per share.
Nov. 1 Received $1 per share cash dividend on Kitselton Co. common stock.
Dec. 15 Received $0.50 per share cash dividend on Gehring Co. common stock.
Dec 31 Received $1 per share semiannual cash dividend on Wooderson Co. common stock.
At December 31, the fair values per share of the common stocks were Gehring Co. $32,
Wooderson Co. $8, and Kitselton Co. $18.
Instructions
(a) Journalize the 2016 transactions and post to the account Stock Investments. (Post in
       T-account form.)
(b) Prepare the adjusting entry at December 31, 2016, to show the securities at fair value.
        The stock should be classified as available-for-sale securities.
(c ) Show the balance sheet presentation of the investment-related accounts at December 31,
        2016. At this date, Turnball Associates has common stock $1,500,000 and retained
        earnings $1,000,000.

NOTE: Enter a number in cells requesting a value; enter either a number or a formula in cells with a "?" .

(a) 2016
July 1 Account Value
Account Value
Aug 1 Account Value
Account Value
Sept. 1 Account Value
Account Value
Account Value
Oct.1 Account Value
Account Value
Account Value
Nov. 1 Account Value
Account Value
Dec. 15 Account Value
Account Value
Dec. 31 Account Value
Account Value
Stock Investments
2016 2016
Jan. 1 Balance Value Sept. 1   Value
Oct. 1 Value
2016
Dec. 31 Balance Value
(b) Dec.31 Account Value
Account Value
Security Cost Fair Value
Gehring Co. Value Value
Wooderson Co. Value Value
Kitselton Co. Value Value
? ?
(c) Investments
        Investments in stock of less than 20%
     owned companies, at fair value Value
Stockholders' equity
    Common stock Value
     Retained earnings Value
          Total paid-in capital and retained earnings ?
     Less: Unrealized loss on available-for-sale securities Value
           Total stockholders' equity ?
After you have completed P12-3A, consider the additional question.
1. Assume that number of shares of Wooderson Co. sold changed to 2,000 shares.
Show impact on the journal entries and presentation in balance sheet.
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