1. On May 1, 2019, RED Company purchased a short-term 2,000,000 face value, 9% debt instruments for 1,860,000 including the accrued interest and classified it as a trading security. The debt instruments mature on January 1, 2022, and pay interest semi-annually on January 1 and July1. On December 31, the fair market value of the instruments is 98. On March 2, 2020, RED sold the trading securities for 1,980,000. How much should RED report the investment on December 31, 2019? A. 1,860,000 B. 1,960,000 C. 1,800,000 D. 1,980,000

2. On October 1, 2019, WHITE Corporation purchased a debt security having a face value of 3,000,000 with an interest rate of 10% for 3,200,000 inclusive of the accrued interest to be held as financial assets at amortized cost. A total of 50,000 was incurred and paid by WHITE in relation to the acquisition of the debt instrument. The bonds mature on January 1, 2024, and pay interest semi-annually on January 1 and July 1. On December 31, 2019, the bonds had a market value of 3,400,000. What amount should WHITE report for the investment in debt securities upon acquisition? A. 3,200,000 B. 3,125,000 C. 3,250,000 D. 3,175,000