Complete Question:
Fair Value Adjustment Journal General Computation of fair value adjustment. Fair Value Adjustment Computation - Available for Sale Portfolio Cost Fair ValueUnrealized Verrizano Corporation bonds payable Preble Corporation notes payable Lucerne Company common stock Total $ 66,500 S 61,900 46,400 85,100 $ 208,400 $ 193,400 54,000 87,900 Fair Value Adjustment General Journal
Answer:
Dr Unrealized loss — Equity $15,000
Cr Available-For-Sale Securities $15,000
Explanation:
The difference of the cost and fair value of the portfolio gives us the loss of $15,000 which must be accounted for in accounting books as under:
Dr Unrealized losses $15,000
Cr Available-For-Sale Securities $15,000
