First Bank purchased the following securities during 2017 and classified them all as trading securities.
Purchased 500 shares of Duke Company's common stock for $55 per share Purchased 2,000 shares of Queen Company's common stock for $45 per share Purchased 1,000 shares of Prince Company's preferred stock at $120 per share. Received $3,000 of dividends during 2017 related to the common stock investments
1.) Prepare journal entries to record the preceding information.
2.) What is the unrealized holding gain or loss and where is it reported on the 2017 financial statements?
3.) Prepare the journal entry to record the unrealized holding gain or loss.
4.) How would the bank report these securities on its balance sheet for the year ended 2017?

Question

First Bank purchased the following securities during 2017 and classified them all as trading securities.
Purchased 500 shares of Duke Company's common stock for $55 per share Purchased 2,000 shares of Queen Company's common stock for $45 per share Purchased 1,000 shares of Prince Company's preferred stock at $120 per share. Received $3,000 of dividends during 2017 related to the common stock investments  
1.) Prepare journal entries to record the preceding information.
2.) What is the unrealized holding gain or loss and where is it reported on the 2017 financial statements?
3.) Prepare the journal entry to record the unrealized holding gain or loss.
4.) How would the bank report these securities on its balance sheet for the year ended 2017?

Quizplus · Accepted Answer

The Answer of First Bank purchased the following securities during 2017 and classified them all as trading securities.
Purchased 500 shares of Duke Company's common stock for $55 per share Purchased 2,000 shares of Queen Company's common stock for $45 per share Purchased 1,000 shares of Prince Company's preferred stock at $120 per share. Received $3,000 of dividends during 2017 related to the common stock investments  
1.) Prepare journal entries to record the preceding information.
2.) What is the unrealized holding gain or loss and where is it reported on the 2017 financial statements?
3.) Prepare the journal entry to record the unrealized holding gain or loss.
4.) How would the bank report these securities on its balance sheet for the year ended 2017?

First Bank Purchased the Following Securities During 2017 and Classified