Amalgamated General Corporation is a consulting firm that also offers financial services through its credit division. From time to time the company buys and sells securities. The following selected transactions relate to Amalgamated's investment activities during the last quarter of 2018 and the first month of 2019. The only securities held by Amalgamated at October 1 were $35 million of 10% bonds of Kansas Abstractors, Inc., purchased on May 1 at face value and held in Amalgamated's trading portfolio. The company's fiscal year ends on December 31. 2018 Oct. 18 Purchased 2 million preferred shares of Millwork Ventures Company for $54 million. 31 Received semiannual interest of $2.1 million from the Kansas Abstractors bonds. Nov. 1 Purchased 10% bonds of Holistic Entertainment Enterprises at their $12 million face value, to be held until they mature in 2025. Semiannual interest is payable April 30 and October 31. 1 Sold the Kansas Abstractors bonds for $32 million because rising interest rates are expected to cause their fair value to continue to fall. No unrealized gains and losses had been recorded on these bonds previously. Dec. 1 Purchased 12% bonds of Household Plastics Corporation at their $ 40 million face value, to be held until they mature in 2028. Semiannual interest is payable May 31 and November 30. 20 Purchased U. S. Treasury bonds for $5.7 million as trading securities, hoping to earn profits on short-term differences in prices. 21 Purchased 4 million common shares of NXS Corporation for $46 million, planning to earn profits from dividends or gains if prevailing market conditions encourage sale. 23 Sold the Treasury bonds for $5.8 million Received cash dividends of $3 million from the Millwork Ventures Company preferred shares. Recorded any necessary adjusting entry(s) and closing entries relating to the investments. The market price of the Millwork Ventures Company preferred stock was $25.00 per share and $12.50 per share for the NXS Corporation common. The fair values of the bond investments were $59.2 million for Household Plastics Corporation and $16.8 million for Holistic Entertainment Enterprises. 2019 Jan. 7 Sold the NXS Corporation common shares for $45 million. Required: Prepare the appropriate journal entry for each transaction or event. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Enter your answers in millions rounded to 1 decimal place, (i.e., 5,500,000 should be entered as 5.5).) Answer is not complete. No Date General Journal Credit Debit 54.00 0ct 18, 2018 Investment in Millwork Ventures Company shares Cash 54.0 / Oct 31, 2018 _2.1 Cash . Investment revenue 21 3 Nov 01, 2018 12.00 Investment in Holistic Entertainment bonds Cash 120 Nov 01, 2018 Cash Loss on sale of investments Investment in Kansas Abstractors bonds 32.0 0 3.o 2 35.0 x Nov 01, 2018 No journal entry required Dec 01, 2018 40.00 Investment in Household Plastics bonds Cash 40.0 / Dec 20, 2018 _5: 10 Investment in U.S. treasury bonds Cash 5. 10 Dec 20, 2018 Investment in U.S. treasury bonds Cash 8 Dec 21, 2018 46.0 Investment in NXS shares Cash 46.0 Dec 23, 2018 5.7 % Cash Gain on sale of investments Investment in U.S. treasury bonds 0.1 5.8 X 10 Dec 23, 2018 No journal entry required Dec 29, 2018 3.0 Cash Dividend revenue a 3.0 12 Dec 31, 2018 Interest receivable-Holistic Entertainment 0.2 Investment revenue 0.2 X 16 Jan 07, 2019 Cash Loss on sale of investments Investment in NXS shares 45.0 1.0 46.0 View transaction list Journal entry worksheet CO O O O O O O O , Record the receipt of semiannual interest of $2.1 million from the Kansas Abstractors bonds. Note: Enter debits before credits. Debit Credit Date General Journal Oct 31, 2018 Cash Investment revenue - 2.1 Record entry Clear entry View general journal View transaction list Journal entry worksheet Oooo 0 Record the entry to adjust to fair value on the date of sale of the Kansas Abstractor bonds. Note: Enter debits before credits. Credit Date General Journal Nov 01, 2018 Cash Loss on sale of investments Investment in Kansas Abstractors bonds Debit 32.0 3.0 35.0 Record entry Clear entry View general journal View transaction list Journal entry worksheet 10 Record the sale of the Treasury bonds for $5.8 million. Note: Enter debits before credits. Debit Credit Date General Journal Dec 23, 2018 No journal entry required Record entry Clear entry View general journal View transaction list Journal entry worksheet 12 Record the accrued interest. Note: Enter debits before credits. Credit Date General Journal Dec 31, 2018 [Interest receivableHolistic Entertainment Investment revenue Debit 0.2 0.2 Record entry Clear entry View general journal View transaction list Journal entry worksheet
