Bentz Corporation bought and sold several securities during 2013. Listed below is a summary of the transactions:

Feb. 17	Purchased $102,000 of treasury 6% bonds at par plus accrued interest of $1,000. The security is to be held for short-term profits.
April 10	Purchased 500 ordinary shares of Gauges Ltd at $140 per share. This security will be held for an unspecified period of time.
August 8	Sold 100 shares of Gauges Ltd. for $150 per share.
October 5	Sold half of the treasury bonds for $51,500 plus accrued interest of $300

Required:

Prepare the journal entries for the above transactions. Show calculations.

Problem- 2

On January 1, 2013, American Corporation purchased 25% of the outstanding ordinary shares of Short Supplies for $210,000 cash. On that date, Short's book value and fair value were both $840,000. The equity method is deemed appropriate for this investment. Short's net income reported on December 31, 2013, was $80,000. During 2013, Short also paid cash dividends in the amount of $24,000. Required: Compute the amount that would be reported for the investment on American Corporation's financial statements at December 31, 2013.

Problem -3

Patrick Company purchased 50 Issac Company 8%, 10-year, 1,000 bonds on January 1, 2020, for 50,000. The bonds pay interest annually. On January 1, 2021, after receipt of interest, Patrick Company sold 30 of the bonds for 29,500.

Required:

Prepare the journal entries to record the transactions described above.