ACCOUNTING FOR SHORT-TERM INVESTMENTS. On January 1, 19x8, the short-term investments of Cardiff, Inc., consisted of U.S. Treasury bills with a market value of $49,100, for which Cardiff had paid $47,300 late last year. During 19x8, Cardiff, Inc., had the following transactions in short-term investments:

a) On February 1, Cardiff received $50,000 from the U.S. Treasury bills at their maturity.

b) On March 18, Cardiff purchased non-interest-bearing notes (commercial paper)

issued by General Motors for $23,500.

c) On April 3, Cardiff sold the General Motors notes for $23,950.

d) On October 12, Cardiff purchased 750 shares of Ford Motor Company stock for $112 per share.

e) On November 20, Cardiff purchased U.S. Treasury bills for $38,900. The bills mature on March 1, 19x9, at $40,000.

f) On November 30, Cardiff sold 500 shares of its Ford Motor stock for $117 per share.

g) On December 28, Ford Motor Company declared and paid a dividend of $5 per share on Cardiff’s remaining shares.

h) On December 31, the following market values were determined:

REQUIRED:
1. Prepare the journal entries to record transactions a through g.
2. Prepare a schedule of Cardiff’s short-term investments in securities at December : 31, 19x8, showing the cost and market value of each security.
3. Prepare the adjusting entry needed, if any, on December 31, 19x8, to establish the proper amount required in the allowance to adjust short-term investments in securities to market value.
4. How will short-term investments be reported on Cardiff's December 31, 19x8, balance sheet?
5. What amounts related to short-term investments in securities will appear on Cardiff’s income statement for 19x8? (Ignore income taxes.)

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Ford Motor Company stock U.S. Treasury bills maturing on 3/1/x9 $115 per share 98.25% of maturity value