Questions: Prepare a table to compare the year-end cost and fair values of its trading debt securities. Year-end fair values: Verizon, 22,500; Apple, 29,000; and Walmart, 46,000. Portfolio of Trading Securities Cost Fair Value Unrealized Amount ------------ Verizon bonds Apple bonds Walmart bonds Total 0 0

To address the requirements of the question, let's proceed step by step.

1. August 2: Purchase of Verizon Bonds

   • Debit: Trading Securities (Verizon Bonds) $24,000
   • Credit: Cash $24,000

2. September 7: Purchase of Apple Bonds

   • Debit: Trading Securities (Apple Bonds) $49,000
   • Credit: Cash $49,000

3. September 12: Purchase of Mastercard Bonds

   • Debit: Trading Securities (Mastercard Bonds) $34,000
   • Credit: Cash $34,000

4. October 21: Sale of Verizon Bonds

   • Debit: Cash $2,800
   • Credit: Trading Securities (Verizon Bonds) $2,700
   • Credit: Gain on Sale of Trading Securities $100

5. October 23: Sale of Apple Bonds

   • Debit: Cash $29,400
   • Credit: Trading Securities (Apple Bonds) $29,000
   • Credit: Gain on Sale of Trading Securities $400

6. November 1: Purchase of Walmart Bonds

   • Debit: Trading Securities (Walmart Bonds) $54,000
   • Credit: Cash $54,000

7. December 10: Sale of Mastercard Bonds

   • Debit: Cash $32,000
   • Debit: Loss on Sale of Trading Securities $2,000
   • Credit: Trading Securities (Mastercard Bonds) $34,000

To prepare the table, we need to calculate the remaining cost of each type of bond after the sales and compare it to the fair value.

• Verizon Bonds:

  • Initial Cost: $24,000
  • Sold Cost: $2,700
  • Remaining Cost: $24,000 - $2,700 = $21,300
  • Fair Value: $22,500
  • Unrealized Gain: $22,500 - $21,300 = $1,200

• Apple Bonds:

  • Initial Cost: $49,000
  • Sold Cost: $29,000
  • Remaining Cost: $49,000 - $29,000 = $20,000
  • Fair Value: $29,000
  • Unrealized Gain: $29,000 - $20,000 = $9,000

• Walmart Bonds:

  • Cost: $54,000
  • Fair Value: $46,000
  • Unrealized Loss: $46,000 - $54,000 = -$8,000

\[ \begin{array}{|l|l|l|l|} \hline \text{Portfolio of Trading Securities} & \text{Cost} & \text{Fair Value} & \text{Unrealized Amount} \\ \hline \text{Verizon Bonds} & \$21,300 & \$22,500 & \$1,200 \\ \hline \text{Apple Bonds} & \$20,000 & \$29,000 & \$9,000 \\ \hline \text{Walmart Bonds} & \$54,000 & \$46,000 & -\$8,000 \\ \hline \text{Total} & \$95,300 & \$97,500 & \$2,200 \\ \hline \end{array} \]

The total unrealized gain for the portfolio is $2,200. The adjusting entry to record this would be:

• Adjusting Entry:
  • Debit: Trading Securities $2,200
  • Credit: Unrealized Gain on Trading Securities $2,200

This entry adjusts the trading securities to their fair value at year-end.