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1 Record the purchase of 2 million shares of Melton Corp. common stock for $78 million. 2 Record the receipt of semiannual interest of $2

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1 Record the purchase of 2 million shares of Melton Corp. common stock for $78 million. 2 Record the receipt of semiannual interest of $2 million from the Castor Corp. bonds. 3 Record the purchase of 10% bonds of Hughes Corp. at their $84 million face value. 4 Record the entry to adjust to fair value on the date of sale of the Castor Corp. bonds. 5 Record the sale of the investment in Castor Corp. bonds. 6 Record the purchase of 12% bonds of Phillips Corp. at Classifleation Financlal statements Classification journal Entries Financial Statements Journal Entries Financial stat value of the Hughes investment. 15 Record any adjusting journal entry needed for the fair value of the Phillips investment. 16 Record any adjusting journal entry needed for the fair value of the Melton investment. 17 Record any adjusting journal entry needed for the fair value of the Nelson investment. Note : = journal entry has been entered Record entry Clear entry View transaction list 11 Record the receipt of cash dividends of $3 million from the Melton Corp. common shares. 17 12 Record the accrued interest for Hughes Corp. bonds. 13 Record the accrued interest for Phillips Corp. bonds. 14 Record any adjusting journal entry needed for the fair value of the Hughes investment. 15 Record any adjusting journal entry needed for the fair value of the Phillips investment. 16 Record any adjusting journal entry needed for the fair Note : = journal entry has been entered Record entry Clear entry View gen Journal Entries Financial statemonts 1. Review the list of transacticos above. Then, select the appropriate classification and accounting treatment for each investment listed in the table belows. 2. Rocord each tranisction or ycar-esd adjusting entgy, using "Imvestment in bonds" or Imvesiment in equily securities" as the name of the investment accounts, If no entry is required for a tranaction/evest, sefect "No journal entry required" in the first account field. Do not reusd intermediate calcalations. recerded en Dec, 31, 2021. 3. Determine the amounts reported on Sonner's 2021 financial statementr: a) BALANCE SHERT: the amounts reported as assets en the balance sheet for investments in equity secturities (and Fair Value Adjustment for all equaty securites) and investments in debt securities (and Fair Value Adjustment for all debt securities) and b) INCOME STATEMENT; the amounts telated to investments (how all gainslowses, realized and unrealired, as a single amount called "Net place, (Ce, 5,500,000 sheuld be entered as 5.5), View transaction list 6 Record the purchase of 12% bonds of Phillips Corp. at their $40 million face value. 17 7 Record the purchase of U.S. Treasury bonds for $6.9 million. 8 Record the purchase of 4 million common shares of Nelson Corp. for $70 million. 9 Record the entry to adjust to fair value on the date of sale of the U.S. Treasury bonds. 10 Record the sale of the Treasury bonds for $7.5 million. 11 Record the receipt of cash dividends of $3 million from Note : = journal entry has been entered Record entry Clear entry View general On Oct. 1, 2021, the beginning of the 4th quarter, Sooner Co, beld 540 million of 10% bonds of Castor Corp., purchased on May 1,2021 at face value and beld as trading recurities. The company's fiscal year ends on December 31 . Listed below are iranactions during the fourth quarter of 2021 relating to the company's iovestments, Date Trinstion Ost 18 Purchased 2 milion shares of Melion Corp, cornmon stock for 578 million, The purchise does not give Sooner significant influence as Melton has a tobal of 56 million shares issocd. Oct 31 Received semiannal isterest of $2.0 million from the Castor Corp. bonds. Now, 1 Rurchased 10% boods of Hughes Corp. at their 584 million face value, to be held watil they mature in 2031 : Semiannual interest is payable April 30 and Occoter 31 . Nov. 1 Sold the Castor Corp, bonds for 533 million. No unrealized gains and losses had been recorded on these bonds previously Dee. 1 Purchased 12% bondr or Phillips Corp, at their 540 miltion face value as available-for-sale securities. The bends mature in 2031 , Semiannual interest it payable May 31 and Noversher 30. Des: 21 Purcbased 4 millice shars of Nelson Com 570 mallion shares of common stock for 570 million, planning to hold these shares indefinisely Dec.23 Sold the Treaury boods for 57,5 million. Dee, 20 Rectived eash dividends of 53 mittion from the Metion Corp. shares of common atock. Additionally, on December 31,2021, the company recoeded any nesevary adfasting entries relating to shasges in fair values of the ievestanents. Specifically, as of December 3I: - The fair value of the Hughes Copp, bond investment was 518.0 million - The fair value of the Phillips Corp, bond inventment was $36.0 millign - The market price of the Metion Corp. common atock was $36.00 per share - The market price of the Netwon Corp, common stock was $22.50 per share 1 Record the purchase of 2 million shares of Melton Corp. common stock for $78 million. 2 Record the receipt of semiannual interest of $2 million from the Castor Corp. bonds. 3 Record the purchase of 10% bonds of Hughes Corp. at their $84 million face value. 4 Record the entry to adjust to fair value on the date of sale of the Castor Corp. bonds. 5 Record the sale of the investment in Castor Corp. bonds. 6 Record the purchase of 12% bonds of Phillips Corp. at Classifleation Financlal statements Classification journal Entries Financial Statements Journal Entries Financial stat value of the Hughes investment. 15 Record any adjusting journal entry needed for the fair value of the Phillips investment. 16 Record any adjusting journal entry needed for the fair value of the Melton investment. 17 Record any adjusting journal entry needed for the fair value of the Nelson investment. Note : = journal entry has been entered Record entry Clear entry View transaction list 11 Record the receipt of cash dividends of $3 million from the Melton Corp. common shares. 17 12 Record the accrued interest for Hughes Corp. bonds. 13 Record the accrued interest for Phillips Corp. bonds. 14 Record any adjusting journal entry needed for the fair value of the Hughes investment. 15 Record any adjusting journal entry needed for the fair value of the Phillips investment. 16 Record any adjusting journal entry needed for the fair Note : = journal entry has been entered Record entry Clear entry View gen Journal Entries Financial statemonts 1. Review the list of transacticos above. Then, select the appropriate classification and accounting treatment for each investment listed in the table belows. 2. Rocord each tranisction or ycar-esd adjusting entgy, using "Imvestment in bonds" or Imvesiment in equily securities" as the name of the investment accounts, If no entry is required for a tranaction/evest, sefect "No journal entry required" in the first account field. Do not reusd intermediate calcalations. recerded en Dec, 31, 2021. 3. Determine the amounts reported on Sonner's 2021 financial statementr: a) BALANCE SHERT: the amounts reported as assets en the balance sheet for investments in equity secturities (and Fair Value Adjustment for all equaty securites) and investments in debt securities (and Fair Value Adjustment for all debt securities) and b) INCOME STATEMENT; the amounts telated to investments (how all gainslowses, realized and unrealired, as a single amount called "Net place, (Ce, 5,500,000 sheuld be entered as 5.5), View transaction list 6 Record the purchase of 12% bonds of Phillips Corp. at their $40 million face value. 17 7 Record the purchase of U.S. Treasury bonds for $6.9 million. 8 Record the purchase of 4 million common shares of Nelson Corp. for $70 million. 9 Record the entry to adjust to fair value on the date of sale of the U.S. Treasury bonds. 10 Record the sale of the Treasury bonds for $7.5 million. 11 Record the receipt of cash dividends of $3 million from Note : = journal entry has been entered Record entry Clear entry View general On Oct. 1, 2021, the beginning of the 4th quarter, Sooner Co, beld 540 million of 10% bonds of Castor Corp., purchased on May 1,2021 at face value and beld as trading recurities. The company's fiscal year ends on December 31 . Listed below are iranactions during the fourth quarter of 2021 relating to the company's iovestments, Date Trinstion Ost 18 Purchased 2 milion shares of Melion Corp, cornmon stock for 578 million, The purchise does not give Sooner significant influence as Melton has a tobal of 56 million shares issocd. Oct 31 Received semiannal isterest of $2.0 million from the Castor Corp. bonds. Now, 1 Rurchased 10% boods of Hughes Corp. at their 584 million face value, to be held watil they mature in 2031 : Semiannual interest is payable April 30 and Occoter 31 . Nov. 1 Sold the Castor Corp, bonds for 533 million. No unrealized gains and losses had been recorded on these bonds previously Dee. 1 Purchased 12% bondr or Phillips Corp, at their 540 miltion face value as available-for-sale securities. The bends mature in 2031 , Semiannual interest it payable May 31 and Noversher 30. Des: 21 Purcbased 4 millice shars of Nelson Com 570 mallion shares of common stock for 570 million, planning to hold these shares indefinisely Dec.23 Sold the Treaury boods for 57,5 million. Dee, 20 Rectived eash dividends of 53 mittion from the Metion Corp. shares of common atock. Additionally, on December 31,2021, the company recoeded any nesevary adfasting entries relating to shasges in fair values of the ievestanents. Specifically, as of December 3I: - The fair value of the Hughes Copp, bond investment was 518.0 million - The fair value of the Phillips Corp, bond inventment was $36.0 millign - The market price of the Metion Corp. common atock was $36.00 per share - The market price of the Netwon Corp, common stock was $22.50 per share

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