P13-3A On December 31, 2008, Ramey Associates owned the following securities, held as a

Price: $2.50


On December 31, 2008, Ramey Associates owned the following securities, held as a
long-term investment.The securities are not held for influence or control of the investee.

Common stock		Shares	Cost
Hurst Co.		2,000	60,000
Pine Co.		5,000	45,000
Scott Co.		1,500	30,000

On December 31, 2008, the total fair value of the securities was equal to its cost. In 2009, the following
transactions occurred.
July 1 Received $1 per share semiannual cash dividend on Pine Co. common stock.
Aug. 1 Received $0.50 per share cash dividend on Hurst Co. common stock.
Sept. 1 Sold 1,500 shares of Pine Co. common stock for cash at $8 per share, less brokerage
fees of $300.
Oct. 1 Sold 800 shares of Hurst Co. common stock for cash at $33 per share, less brokerage
fees of $500.
Nov. 1 Received $1 per share cash dividend on Scott Co. common stock.
Dec. 15 Received $0.50 per share cash dividend on Hurst Co. common stock.
31 Received $1 per share semiannual cash dividend on Pine Co. common stock.
At December 31, the fair values per share of the common stocks were: Hurst Co. $32, Pine Co.
$8, and Scott Co. $18.

Instructions
(a) Journalize the 2009 transactions and post to the account Stock Investments. (Use the T-account
form.)
(b) Prepare the adjusting entry at December 31, 2009, to show the securities at fair value. The
stock should be classified as available-for-sale securities.
(c) Show the balance sheet presentation of the investments at December 31, 2009. At this date,
Ramey Associates has common stock $1,500,000 and retained earnings $1,000,000.