1 The Janjua Company had the following account balances at 1 1 18 Common Stock Treasury Stock (at cost) Paid in Capital in Excess of Par Investments in AFS Debt Securities FVA (AFS) Retained Earnings $65,000 13,400 82,000 40,000 2,500 credit 22,000 On that date, the Accumulated OCI account was at its proper balance There were no sales or purchases of Common Stock or Investments during 2018 Prior to any adjusting journal entries related to the investments, 2018 Net Income was $10,300 No other transactions affecting Retained Earnings occurred Fair Value of the Investments at 12 31 2018 was $38,500 Required Prepare the 12 31 18 journal entry to adjust the investment to fair value Prepare the complete 12 31 18 Equity section of the balance sheet 2 The following information relates to the HTM debt securities investments of Kiran Company during 2018 a February 1 The company purchased 10 bonds of Tempe Company having a par value of $150,000 at 98 plus accrued interest Interest is payable January 1 and July 1 Maturity date is 1 1 20 b July 1 Semiannual interest is received and amortization is updated for the Tempe bonds c December 31 Interest is accrued and amortization updated for the Tempe bonds d June 1 9 bonds of Flagstaff were purchased The bonds had a par value of $80,000 and were purchased at 103 plus accrued interest Interest dates are January 1 and July 1 Maturity date is 1 1 20 e July 1 Semiannual interest is received and amortization updated for the Flagstaff bonds f December 31 Interest is accrued and amortization updated for the Flagstaff bonds 1 Required Prepare journal entries for all dates Journal entries for the Tempe bonds (a, b, c) Journal Entries for the Flagstaff bonds (d, e, f) No explanations or supporting computations are required Use straight line amortization Do NOT use separate accounts for discounts and premiums instead, net them into the Investments account When computing amortization, round the monthly amortization amounts to the nearest cent However, journal entry amounts can be rounded to the nearest dollar

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1. The Janjua Company had the following account balances at 1/1/18: Common Stock Treasury Stock (at cost) Paid-in-Capital in Excess of Par Investments in AFS

1. The Janjua Company had the following account balances at 1/1/18:

Common Stock Treasury Stock (at cost) Paid-in-Capital in Excess of Par Investments in AFS Debt Securities FVA (AFS) Retained Earnings

$65,000 13,400 82,000 40,000

2,500 credit 22,000

On that date, the Accumulated OCI account was at its proper balance. There were no sales or purchases of Common Stock or Investments during 2018. Prior to any adjusting journal entries related to the investments, 2018 Net Income was $10,300. No other transactions affecting Retained Earnings occurred. Fair Value of the Investments at 12/31/2018 was $38,500.

Required:

Prepare the 12/31/18 journal entry to adjust the investment to fair value.
Prepare the complete 12/31/18 Equity section of the balance sheet. 2. The following information relates to the HTM debt securities investments of Kiran Company

during 2018:

a. February 1: The company purchased 10% bonds of Tempe Company having a par value of $150,000 at 98 plus accrued interest. Interest is payable January 1 and July 1. Maturity date is 1/1/20.

b. July 1: Semiannual interest is received and amortization is updated for the Tempe bonds. c. December 31: Interest is accrued and amortization updated for the Tempe bonds.

d. June 1: 9% bonds of Flagstaff were purchased. The bonds had a par value of $80,000 and were purchased at 103 plus accrued interest. Interest dates are January 1 and July 1. Maturity date is 1/1/20.

e. July 1: Semiannual interest is received and amortization updated for the Flagstaff bonds. f. December 31: Interest is accrued and amortization updated for the Flagstaff bonds.

Required:

Prepare journal entries for all dates. Journal entries for the Tempe bonds (a, b, c) Journal Entries for the Flagstaff bonds (d, e, f). No explanations or supporting computations are required. Use straight-line

amortization. Do NOT use separate accounts for discounts and premiums; instead, net them into the Investments account. When computing amortization, round the monthly amortization amounts to the nearest cent. However, journal entry amounts can be rounded to the nearest dollar.