Pete Sampras Corporation purchased trading investment bonds for $40,000 at par. At December 31, Sampras received annual

Question:

Pete Sampras purchased trading investment bonds for $40,000 at par. At December 31, Sampras received annual interest of $2,000, and the fair value of the bonds was $38,400. Prepare Sampras’ journal entries for
(a) The purchase of the investment,
(b) The interest received, and
(c) The fair value adjustment.

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...