American Surety and Fidelity buys and sells securities expecting to earn profits on short-term differences in price. For the first 11 months of 2024, gains from selling trading securities totaled $6 million, losses from selling trading securities were $12 million, and the company had earned $5 million in interest revenue. The following selected transactions relate to American's investments in trading securities and equity securities during December 2024, and the first week of 2025. The company's fiscal year ends on December 31 . No trading securities or equity investments were held by American on December 1, 2024. Assume that the bonds are purchased at face value. December 12, 2024 Purchased FFSG Corporation bonds for $23 miltion. December 13, 2024 Purchased 2 million shares of Ferry Intercommunications common stock for $30 miltion. Anerican does. not have significant influence over Ferry's operations or policies. Decenber 15, 2024 Sold the FFGG Corporation bonds for $23.2 million. Decenber 22, 2024 Purchased U.S. Treasury bills for $70 million and Treasury bonds for $76million. December 23, 2024 Sold half the shares of Ferry Intercommunications common stock for $10 million. Decenber 26,2024 Sold the U.S. Treasury bills for $75 million. December 27,2024 Sold the Treasury bonds for $73 milition. December 28,2024 Received cash dividends of $200,000 from the Ferry Intercommunications conmon stock shares. December 31, 2024 Recorded any necessary adjusting entry relating to the remaining investment. The market price of the Ferry Intercommunications stock was $10 per share. January 2, 2025 Sotd the remaining Ferry Intercommunications common stock shares for $10.1million. January 5, 2025 Purchased Warehouse Designs Corporation bonds for $45 miltion. Required: 1. Prepare the appropriate journal entry for each transaction or event during 2024 including any year-end adjusting entries. 2. Indicate any amounts that American would report in its 2024 balance sheet and income statement as a result of these investments. Ignore income taxes. 3. Prepare the appropriate journal entry for each transaction or event during 2025. Complete this question by entering your answers in the tabs below. Prepare the appropriate journal entry for each transaction or event during 2024 including any year-end adjusting entries. Note: if no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions rounded to 1 decimal place, (1.e., 5,500,000 should be entered as 5.5). Complete this question by entering your answers in the tabs below. Prepare the appropriate journal entry for each transaction or event during 2024 including any year-end sdjusting entrles. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in miltions rounded to 1 decimal ploce, (b.e., 5,500,000 should be entered as 5.5 ). \begin{tabular}{|c|c|c|c|c|c|} \hline 6 & December 23,202 & Loss on investment (unrealized, NI) & ( & 82.0 & \\ \hline & & Fair value adjustment & & & 82.0 \\ \hline \multirow[t]{3}{*}{7} & December 23, 202 & Cash & 0 & & \\ \hline & & Fair value adjustment & 0 & & 10.0 \\ \hline & & Investment in equity securities & 0 & 7 & 20.0 \\ \hline \multirow[t]{2}{*}{8} & December 26,202 & Fair value adjustment & 0 & 10.0 & \\ \hline & & Gain on investment (unrealized, NI) & 0 & & 10.0 \\ \hline \multirow[t]{3}{*}{9} & December 26,202 & Cash & 0 & 75.00 & \\ \hline & & Investment in bonds & 0 & & 5.0 \\ \hline & & Fair value adjustment & 0 & & 80.0% \\ \hline \multirow[t]{2}{*}{10} & December 27,202 & 2Loss on investment (unrealized, NI) & 0 & 10.0 & \\ \hline & & Fair value adjustment & 0 & & 10.0 \\ \hline \multirow[t]{3}{*}{11} & December 27,202 & 2Cash & 0 & 10.0 & \\ \hline & & Fair value adjustment & 0 & & 5.0 \\ \hline & & Investment in bonds & 0 & & 15.0 \\ \hline \multirow[t]{2}{*}{12} & December 28,202 & Cash & 0 & 0.20 & \\ \hline & & Dividend revenue & 0 & & 0.20 \\ \hline 13 & December 31,202L & 12 Loss on investment (unrealized, NI) & & 15.0 & \\ \hline \end{tabular} place, (i.e., 5,500,000 should be entered as 5.5). 2. Indicate any amounts that American would report in its 2024 balance sheet and income statement as a result of these investments. Ignore income taxes. 3. Prepare the appropriate journal entry for each transaction or event during 2025. Answer is not complete. Complete this question by entering your answers in the tabs below. Prepare the appropriate journal entry for each transaction or event during 2025. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions rounded to 1 decimal place, (i.e., 5,500,000 should be entered as 5.5)
