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Coronado Company has the following portfolio of investment securities at September 30, 2017, its last reporting date.
| Trading Securities | Cost | Fair Value | ||
| Horton, Inc. common (5,180 shares) | $217,560 | $204,010 | ||
| Monty, Inc. preferred (3,200 shares) | 115,200 | 121,760 | ||
| Oakwood Corp. common (930 shares) | 171,120 | 170,150 |
On October 10, 2017, the Horton shares were sold at a price of $51 per share. In addition, 3,150 shares of Patriot common stock were acquired at $53 per share on November 2, 2017. The December 31, 2017, fair values were Monty $87,420, Patriot $136,340, and the Oakwood $183,240.
Prepare the journal entries to record the sale, purchase, and adjusting entries related to the equity securities in the last quarter of 2017.
Expert Answer
| Date | Particulars | Debit | Credit |
| Oct.10 2017 | Cash (5,180 X $51) | $264,180 | |
| Gain on Sale of Stock | $46,620 | ||
| Trading Securities | $217,560 | ||
| Nov. 2 2017 | Trading Securities (3,150 X $53) | $166,950 | |
| Cash | $166,950 | ||
| Dec.31 2017 | Unrealized Holding Gain or Loss—Income | $38,310 | |
| Securities Fair Value Adjustment (Trading) | $38,310 | ||
| Trading Securities Portfolio—September 30, 2017 | |||
| Cost | Fair value | Unrealized Gain (Loss) | |
| Horton, Inc. common (5,180 shares) | $217,560 | $204,010 | -$13,550 |
| Monty, Inc. preferred (3,200 shares) | 115200 | 121760 | $6,560 |
| Oakwood Corp. common (930 shares) | 171120 | 170150 | -$970 |
| Total of portfolio | $503,880 | $495,920 | -$7,960 |
| Previous securities fair value adjustment balance | $0 | ||
| Securities fair value adjustment—Cr. | -$7,960 | ||
| Trading Securities Portfolio—December 31, 2017 | |||
| Cost | Fair value | Unrealized Gain (Loss) | |
| Patriot common (3150 shares) | $166,950 | $136,340 | -$79,530 |
| Monty, Inc. preferred (3,200 shares) | 115200 | $87,420 | $21,140 |
| Oakwood Corp. common (930 shares) | 171120 | $183,240 | $12,120 |
| Total of portfolio | $453,270 | $270,660 | -$46,270 |
| Previous securities fair value adjustment balance | -$7,960 | ||
| Securities fair value adjustment—Cr. | -$38,310 | ||
