Record the yearend adjusting entry for the securities portfo

Record the year-end adjusting entry for the securities portfolio as of December 31, 2015.

Record the year-end adjusting entry for the securities portfolio as of December 31, 2016.

Record the year-end adjusting entry for the securities portfolio as of December 31, 2017.

Record the year-end adjusting entry for the securities portfolio as of December 31, 2018

Exercise 15-10 Multiyear fair value adjustments to available-for-sale securities LO P3 Ticker Services began operations in 2015 and maintains long-term investments in available-for-sale securities. The year-end cost and fair values for its portfolio of these investments follow Portfolio of Available-for-Sale Securities December 31, 2015 December 31, 2016 December 31, 2017 December 31, 2018 Cost $337,940 $327,802 Fair Value 385,252 523,943 791,154 408,367 619,825 704,127 Prepare journal entries to record each year-end fair value adjustment for these securities

Solution

Cost Fair Value Fair Value Above (Below) Cost 31-Dec-15        337,940.00    327,802.00                 (10,138.00) 31-Dec-16        385,252.00    408,367.00                   23,115.00 31-Dec-17        523,943.00    619,825.00                   95,882.00 31-Dec-18        791,154.00    704,127.00                 (87,027.00) Calculation adjustment required to fair value adjustment: 31-Dec-15 Existing Balance in Fair Value Adjustment-AFS (LT)                       -   Required Balance in Fair Value Adjustment-AFS (LT)     (10,138.00) Adjustment required to Fair Value Adjustment - AFS (LT)     (10,138.00) 31-Dec-16 Existing Balance in Fair Value Adjustment-AFS (LT)     (10,138.00) Required Balance in Fair Value Adjustment-AFS (LT)        23,115.00 Adjustment required to Fair Value Adjustment - AFS (LT)        33,253.00 31-Dec-17 Existing Balance in Fair Value Adjustment-AFS (LT)        23,115.00 Required Balance in Fair Value Adjustment-AFS (LT)        95,882.00 Adjustment required to Fair Value Adjustment - AFS (LT)        72,767.00 31-Dec-18 Existing Balance in Fair Value Adjustment-AFS (LT)        95,882.00 Required Balance in Fair Value Adjustment-AFS (LT)     (87,027.00) Adjustment required to Fair Value Adjustment - AFS (LT) (182,909.00) Journal Entry Date Particulars Dr. Amt. Cr. Amt. 31-Dec-15 Unrealized Holding Gain (Loss) - Equity      10,138.00     Fair Value Adjustment (Available for Sale)          10,138.00 (To record the adjusting entry for Fair Value Adjustment) 31-Dec-16 Fair Value Adjustment (Available for Sale)          33,253.00     Unrealized Holding Gain (Loss) - Equity      33,253.00 (To record the adjusting entry for Fair Value Adjustment) 31-Dec-17 Fair Value Adjustment (Available for Sale)          72,767.00     Unrealized Holding Gain (Loss) - Equity      72,767.00 (To record the adjusting entry for Fair Value Adjustment) 31-Dec-18 Unrealized Holding Gain (Loss) - Equity    182,909.00     Fair Value Adjustment (Available for Sale)        182,909.00 (To record the adjusting entry for Fair Value Adjustment)