Please fill out all of it - its all 1 exercise. Please use the accounts from the
ID: 2537532 • Letter: P
Question
Please fill out all of it - its all 1 exercise. Please use the accounts from the list i provided and spell the full name of it.
Sandhill Company has the folowing investment s ot December 31, 2017: nwestments in common stock af Laser Compeny Inwestment in debt securities of FourSquare Company 3,430,000 In both inwestments, the carrying value and the fair value of these tno inveatments are the same at December 31, 2017. Sanchills stock inwestments does not recult in signifcant influence on the operations of Laser Company. Sandhils debt invertment is conaidered held to matunty. At $1,620,000 becember 31, 2018, the shares in Leser Compeny are velued at $1,170,000; the debt investment securities of FourSquare are valued at $2,560,000, Assume that these investments ere considered impaired. Prepare the journal entries for these two securiies at December 31, 201, assuming that they are permanently impaired. (Credit account tities are automatically indented when amount is entered. Do not indent manually If no entry is required, select "No Entry for the account titles and enter o for the amounts.) Date Account Titles and Explanation Dec. 31, 2018 Entry for investments in Laser Company) (Entry for of investments in FourSquare Company SHOW LIST OF ACCOUNTS LINK TO TEXT Assuming the fair value of the Lazer shares $1,620,000 and the value of its debt investment is $3,010,000, what entries, if any, should be recorded in 2019 related to impairment? (Credit account tities are automatically indented when amount is entered. Do not Indent manually. If no entry is required, select "No Entry for the account tities and enter o for the amounts.) DateAccount Titdes and Explanation Dec 31, 2019Explanation / Answer
1)Prepare the journal entries to record the impairment of these two securities at December 31, 2018. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit Dec.31 2018 Loss on Impairment ($1620000 - $1170000) $450,000.00 Equity Investments $450,000.00 (Entry for investments in Laser Company) Dec. 31, 2018 Loss on Impairment ($3430000 - $2560000) $870,000.00 Debt Investments $870,000.00 (Entry for of investments in FourSquare Company) b) Assuming the fair value of the Laser shares is $1,620,000 and the value of its debt investment is $3,010,000, what entries, if any, should be recorded in 2019 related to impairment? (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31, 2019 No Entry $0.00 Impaired securities cannot be adjusted upwards. $0.00 c) Prepare the journal entries at December 31, 2018, assuming these securities are not impaired. (Ignore interest revenue entries.) (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31, 2018 Fair Value Adjustment ($1620000-$1620000) $0.00 Unrealized Holding Gain or Loss - Income $0.00 (Entry for investments in Laser Company) Dec. 31, 2018 Fair Value Adjustment($3430000 - $3010000) $420,000.00 Unrealized Holding Gain or Loss - Income $420,000.00 (Entry for of investments in FourSquare Company) d)Assume that the debt investment in FourSquare Company was available-for-sale and the expected credit loss was $960,000. Prepare the journal entry to record this impairment on December 31, 2018. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31, 2018 Loss on Impairment $870,000.00 Allowance for Impaired Debt Investment $870,000.00 An allowance account is used because the impaired debt security can be written back up to its present amortized carrying value. Also the loss was limited to $ 870,000, not $960,000