Kirkland Company had no trading debt securities prior tothis year. It had the following transactions this yearinvolving trading debt securities.August 2 Purchased Verizon bonds for $50,000.September 7 Purchased Apple bonds for $75,000.September 12 Purchased Mastercard bonds for $60,000.October 21 Sold some of its Verizon bonds that hadcost $4,000 for $4,100 cash.October 23 Sold some of its Apple bonds that had cost$55,000 for $55,400 cash.November 1 Purchased Walmart bonds for $80,000.December 10 Sold all of its Mastercard bonds for$58,000 cash.Required1. Prepare journal entries to record these transactions.2. Prepare a table to compare the year-end cost and fairvalues of its trading debt securities. Year-end fair values:Verizon, $48,500; Apple, $42,000; and Walmart, $59,000.3. Prepare the adjusting entry to record the year-end fairvalue adjustment for the portfolio of trading debtsecurities.Complete this question by entering your ansbelow.Required 1 Required 2 Required 3Prepare a table to compare the year-end cost anddebt securities. Year-end fair values: Verizon, $48,and Walmart, $59,000.Portfolio of Trading SecuritiesVerizon bondsApple bondsWalmart bondsTotal$CostFair Value0 $< Required 10UnrealizedAmountRequired 3 >

A Journal entry is a primary entry that records the financial transactions initially. The…

Answered: Kirkland Company had no trading debt…

Kirkland Company had no trading debt securities prior to this year. It had the following transactions this year involving trading debt securities.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 2TP: Below is select information from two, independent companies. Additional information includes: On...

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Concept explainers

Characteristics of Bonds

Question

Kirkland Company had no trading debt securities prior to
this year. It had the following transactions this year
involving trading debt securities.
August 2 Purchased Verizon bonds for $50,000.
September 7 Purchased Apple bonds for $75,000.
September 12 Purchased Mastercard bonds for $60,000.
October 21 Sold some of its Verizon bonds that had
cost $4,000 for $4,100 cash.
October 23 Sold some of its Apple bonds that had cost
$55,000 for $55,400 cash.
November 1 Purchased Walmart bonds for $80,000.
December 10 Sold all of its Mastercard bonds for
$58,000 cash.
Required
1. Prepare journal entries to record these transactions.
2. Prepare a table to compare the year-end cost and fair
values of its trading debt securities. Year-end fair values:
Verizon, $48,500; Apple, $42,000; and Walmart, $59,000.
3. Prepare the adjusting entry to record the year-end fair
value adjustment for the portfolio of trading debt
securities.
Complete this question by entering your ans
below.
Required 1 Required 2 Required 3
Prepare a table to compare the year-end cost and
debt securities. Year-end fair values: Verizon, $48,
and Walmart, $59,000.
Portfolio of Trading Securities
Verizon bonds
Apple bonds
Walmart bonds
Total
$
Cost
Fair Value
0 $
< Required 1
0
Unrealized
Amount
Required 3 >

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