Business, 16.04.2021 19:50 marie2061

Southeast Bank invests in equity securities and prepares quarterly financial statements. At the beginning of the fourth quarter of 2019, the bank held as an investment in equity securities 160 shares of Eglan Company common stock that originally cost $4,560. At that time, these securities had a fair value of $4,320. During the fourth quarter, the bank engaged in the following transactions: Oct. 26 Purchased 360 shares of Farrell Company common stock for $38 per share.
Nov. 26 Sold 160 shares of Eglan common stock for $26 per share.
Dec. 10 Purchased 370 shares of Gray Company common stock for $40 per share.

On December 31, 2018, the quoted market prices of the shares were as follows: Eglan Company, $52 per share; Farrell Company, $41 per share; and Gray Company, $39 per share.

Required:
a. Prepare journal entries to record the 2018 transactions for the fourth quarter.
b. Show what the bank reports on its fourth quarter 2018 income statement for these trading securities.
c. Show how the bank reports these trading securities on its balance sheet at the end of the fourth quarter of 2018.

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Southeast Bank invests in equity securities and prepares quarterly financial statements. At the begi...

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