Kingbird Company has the following securities in its portfolio on December 31, 2025. None of these investments are accounted for
under the equity method.
Investments
Cost
Fair Value
1,500 shares of Gordon, Inc., common
$78,000
$73,700
5,000 shares of Wallace Corp., common
175,000 170,100
400 shares of Martin, Inc., preferred
58.800
60,200
$311,800 $304,000
All of the securities were purchased in 2025.
In 2026, Kingbird completed the following securities transactions.
March 1
April 1
Sold the 1,500 shares of Gordon, Inc., common, @ $45 less fees of $1,200.
Bought 700 shares of Earnhart Corp., common, @ $75 plus fees of $1,400.
Kingbird's portfolio of equity securities appeared as follows on December 31, 2026.
Investments
Cost
Fair Value
5,000 shares of Wallace Corp., common
700 shares of Earnhart Corp., common
$175,000
53,900
$170,100
50,900
400 shares of Martin, Inc., preferred
58,800 56,700
$287,700 $277,700
Prepare the general journal entries for Kingbird Company for:
(a) The 2025 adjusting entry.
(b) The sale of the Gordon stock.
(c) The purchase of the Earnhart stock.
(d) The 2026 adjusting entry for the portfolio.
(List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If
no entry is required, select "No Entry" for the account titles and enter O for the amounts.)
No. Account Titles and Explanation
(a)
Debit
Credit
(b)
(c)
(d)
