Musli Inc. had the following transactions involving non-strategic investments during 2014:

Required
1. Prepare an amortization schedule for the Barker bond showing only 2014 and 2015.
2. Prepare journal entries to record the preceding transactions.
3. Show how Musli Inc.’s investments will appear on its December 31, 2014, balance sheet.
Analysis Component: Musli Inc. purchased the Barker Inc. bond for less than its face value. Explainwhy.

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2014 Feb 1 Paid S70,000 to buy a 60-day term deposit, 570,000 principal amount, 6.23%, dated Feb. 1 Purchased 6,000 common shares of Hilton Ltd. at $11.25 Received a cheque for the principal and accrued interest on the term deposit that matured today Purchased 8,200 common shares of Elder Corp. at $9.75 Purchased 14,000 common shares of Venture Ltd. at $3.40 Purchased for $67,069 a 6.8%, $68,000 Barker Inc. bond that matures in four years when the market interest rate was 7.2%. Interest is paid semi-annually beginning December 31, 2014. Musli Inc. plans to hold this investment until maturity Received a $0.30 per share cash dividend on the Hilton common shares Sold 4,000 of the Hilton common shares at $11.15 Received a $0.30 per share cash dividend on the remaining Hilton common shares owned 21 2 Apr. 15 20 1 July 15 28 Dec 1 31 Received the interest on the Barker bond 31 The fair values of Musli Inc.'s investments on this date were: Hilton shares $12.60; Elder shares, $10.30; Venture shares, $3.20. Assume the fair value and carrying value of the Barker bond were equal 2015 Feb. 16 Sold the remaining Hilton shares at $12.65 less a brokerage fee of $200