1) On January 1, 2021, York Company acquires $500,000 of Jersey Company's 5-year, 8% bonds at a price of $650,000 to yield 6%. Interest is payable each December 31. The bonds are classified as held-to-maturity. Assuming that York Company uses the effective-interest method, what is the amount of interest revenue that would be recognized in 2022 related to these bonds?

2) Investments in equity securities are adjusted to fair value at the end of the period. (True/False)

3) During 2021 Giant Company purchased 8,000 shares of Small, Inc. for $10 per share. During the year Giant Company sold 2,000 shares of Small, Inc. for $23 per share. At December 31, 2021 the market price of Small, Inc.'s stock was $25 per share. What is the total amount of gain/(loss) that Giant Company will report in its income statement for the year ended December 31, 2021 related to its investment in Small, Inc. stock?

4) At December 31, 2021, High Company has an equity portfolio valued at $200,000. Its cost was $120,000. If the Securities Fair Value Adjustment has a debit balance of $5,000, how much of an adjustment will be necessary at year end?

5) On January 1, 2021 High Company purchased 40% of the outstanding common stock of Low, Inc. and used the equity method to account for the investment. During 2021 Low, Inc. reported net income of $2,000,000 and distributed dividends of $400,000. The ending balance in the Investment in High Company account at December 31, 2021 was $1,000,000 after applying the equity method during 2021. What was the purchase price High Company paid for its investment in Low, Inc?

6) Investments in equity securities can be distinguished as either short-term or long- term investments. Investments in equity securities that are short-term can be further distinguished as either trading or available-for-sale securities. (True/False)