On December 21, 2013, Bucky Katt Company provided you with the following information regarding its trading securities.
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31-Dec-13
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Investments (Trading)
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Cost
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Fair Value
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Unrealized Gain (Loss)
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Clemson Corp. stock
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$20,000
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$19,000
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($1,000)
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Colorado Co. stock
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10,000
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9,000
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-1,000
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Buffaloes Co. stock
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20,000
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20,600
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600
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Total of portfolio
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$50,000
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$48,600
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-1,400
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Previous fair value adjustment balance
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0
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Fair value adjustment-Cr
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($1,400)
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During 2014, Colorado Company stock was sold for $9,400. The fair value of the stock on December 31, 2014, was Clemson Corp. stock-$19,100; Buffaloes Co. stock-$20,500.
(a) Prepare the adjusting journal entry needed on December 31, 2013.
(b) Prepare the journal entry to record the sale of the Colorado Company stock during 2014.
(c) Prepare the adjusting journal entry needed on December 31, 2014.