Following Is Data for the Available-For-Sale Securities Held by AdBrand

question 127

Essay

Following is data for the available-for-sale securities held by AdBrand Company as of December 31, 2012.
Required:


(1) Complete the table above to find the total cost and fair value for the company's available-for-sale securities portfolio.
(2) Calculate and record the required December 31, 2012 adjustment.
(3) Explain how the adjustment from step (2) is reported on AdBrand's 2012 financial statements.

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Definitions:

Common Stock

Represents equity ownership in a corporation, with holders possibly entitled to vote on corporate policy and receive dividends.

Dividends

Payments made by a corporation to its shareholder members, distributed from the company's profits.

Expenses

Costs incurred in the operation of a business which may include costs such as rent, utilities, payroll, and materials.

Revenues

The sum of money made through the sale of goods or services, which constitute the primary operations of a corporation.