August 19 Purchased Kodak bonds for $22,300. December 31 Fair values for debt in the portfolio are Kodak, $22,825; Sara Lee, $22,000; and Sony, $66,000. Year 3 February 27 Purchased Microsoft bonds for $159,800. June 21 Sold all of the Sony notes for $65,600. June 30 Purchased Black & Decker bonds for $60,400. August 3 Sold all of the Sara Lee notes for $18,750. November 1 Sold all of the Kodak bonds for $26,975. December 31 Fair values for debt in the portfolio are Black & Decker, $60,600; and Microsoft, $160,600. Required: 1. Prepare journal entries to record these transactions and the year-end fair value adjustments to the portfolio of long- term available-for-sale debt securities.
August 19 Purchased Kodak bonds for $22,300. December 31 Fair values for debt in the portfolio are Kodak, $22,825; Sara Lee, $22,000; and Sony, $66,000. Year 3 February 27 Purchased Microsoft bonds for $159,800. June 21 Sold all of the Sony notes for $65,600. June 30 Purchased Black & Decker bonds for $60,400. August 3 Sold all of the Sara Lee notes for $18,750. November 1 Sold all of the Kodak bonds for $26,975. December 31 Fair values for debt in the portfolio are Black & Decker, $60,600; and Microsoft, $160,600. Required: 1. Prepare journal entries to record these transactions and the year-end fair value adjustments to the portfolio of long- term available-for-sale debt securities.
Financial Accounting
15th Edition
ISBN:9781337272124
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter15: Investments And Fair Value Accounting
Section: Chapter Questions
Problem 1PB: Rekya Mart Inc. is a general merchandise retail company that began operations on January 1, Year 1....
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