Problem: The following securities are in Hi-Tech Company's portfolio of long-term available for-sale securities at December 31, 2002.
COST
1,000 Shares of Awixa Corporation common stock 52,000
1,400 shares of Hal Corporation common stock 84,000
800 shares of Renda Corporation Preferred Stock 33,600
On December 31, 2002, the total cost of the portfolio equaled total fair value. Hi-Tech had the following transactions related to the securities during 2003.
Jan. 20 Sold 1,000 shares of Awixa Corporation common stock at $56 per share less brokerage fees of $600.
28 Purchased 400 shares of $70 par value common stock of Mintor Corporation at $78 per share, plus brokerage fees of $480.
30 Received a cash dividend of $1.15 per share on HAL Corp. common stock.
Feb. 8 Received cash dividends of $0.40 per share on Renda Corp. preferred stock
18 Sold all 800 shares of Renda Corp. preferred stock at $30.00 per share less brokerage fees of $360.
July 30 Received a cash dividend of $1.00 per share on HAL Corp. common
Sept. 6 Purchased an additional 800 shares of $10 par value common stock of Mintor Corporation at $82 per share, plus brokerage fees of $800.
Dec. 1 Received a cash dividend of $1.50 per share on Mintor Corporation common stock.
At December 31, 2003, the fair values of the securities were:
$64 per share HAL Corporation common stock
$72 per Share Mintor Corporation Sommon Stock
Hi-Tech Company uses separate account titles for each investment, such as "Investment in HAL Corporation Common Stock."
Instructions
(a) Prepare journal entries to record the transactions.
(b) Post to the investment accounts. (Use T accounts.)
(c) Prepare the adjusting entry at December 31, 2003, to report the portfolio at fair value.
(d) Show the balance sheet presentation at December 31, 2003