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At December 31, the investments in the portfolio of the trading securities of Kennedy Company included the following. Purchase Original Purchase Security Atlanta Corp., 5%
At December 31, the investments in the portfolio of the trading securities of Kennedy Company included the following. Purchase Original Purchase Security Atlanta Corp., 5% Date Price at Par Oct. 1 $50,000 Dallas Inc. bonds, 4% Jul. 1 Statement Presentation for Year 1 25,000 Statement Presentation for Year 2 a. Record the entry for the receipt of quarterly interest from the Atlanta Corp. bonds on December 31. Date Dec. 31, Year 1 Account Name To record the receipt of interest. Debit Credit b. Record the entry for the receipt of semiannual interest from the Dallas Inc. bonds on December 31. Date Account Name Dec. 31, Year 1 To record the receipt of interest. Debit Credit c. Record the entry to adjust the bonds to fair value on December 31. The fair value of the Atlanta Corp. bonds and the Dallas Inc. bonds on December 31 were $55,000 and $22,500, respectively. Date Dec. 31, Year 1 Account Name To adjust bonds to fair value at year-end. Debit Credit d. Indicate the total amount to be included on the December 31 balance sheet of Kennedy Company as investments in trading securities. Trading securities, Dec. 31, Year 1: $ e. Record the entry to sell the Atlanta Corp. bonds on January 2, Year 2, for $56,250. Date Jan. 2, Year 2 Account Name To record the sale of investments. Debit Credit
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