Can you please help with the following ive been in the hospital and have gotten behind

Brief Exercise 116 On April 1, 2018, West Company purchased $422,000 of 6.75% bonds for $438,630 plus accrued interest as an available-for-sale security. Interest is paid on July 1 and January 1 and the bonds mature on July 1, 2023. Prepare the journal entry on April 1, 2018. (Credit account titles are automatically indented when amount entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and en 0 for the amounts.) Date Account Titles and Explanation Debit Credit Apr. 1, 2018 The bonds are sold on November 1, 2019 at 103 plus accrued interest. Amortization was recorded when interest w received by the straight-line method. Prepare all entries required to properly record the sale. (Credit account tit are automatically indented when amount is entered. Do not indent manually. If no entry is required, se "No Entry" for the account titles and enter 0 for the amounts. Round answers to 0 decimal places, e. 5,275.) Account Titles and Explanation (To record amortization) (To record interest) Debit Credit 0 plus accrued interest as an s mature on July 1, 2023. y indented when amount is the account titles and enter was recorded when interest was e sale. (Credit account titles If no entry is required, select rs to 0 decimal places, e.g. Exercise 123 On January 2, 2018, Tylor Company issued a 4-year, $600,000 note at 8% fixed interest, interest payable semiannually. Tylor now wants to change the note to a variable rate note. As a result, on January 2, 2018, Tylor Company enters into an interest rate swap where it agrees to receive 8% fixed and pay LIBOR of 5.6% for the first 6 months on $600,000. At each 6-month period, the variable interest rate will be reset. The variable rate is reset to 6.6% on June 30, 2018. Compute the net interest expense to be reported for this note and related swap transaction as of June 30, 2018. Net interest expense Compute the net interest expense to be reported for this note and related swap transaction as of December 31, 2018. Net interest expense Brief Exercise 17-2 Sandhill Company purchased, on January 1, 2017, as an available-for-sale security, $68,000 of the 8%, 5-year bonds of Che $62,845, which provides an 10% return. Prepare Sandhill's journal entries for (a) the purchase of the investment, (b) the receipt of annual interest and discount a the year-end fair value adjustment. (Assume a zero balance in the Fair Value Adjustment account.) The bonds have a yea $64,600. (Round answers to 0 decimal places, e.g. 1,225. Credit account titles are automatically indented when amount indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amoun No. a b c Account Titles and Explanation Debit Credit 00 of the 8%, 5-year bonds of Chester Corporation for rn. of annual interest and discount amortization, and (c) nt account.) The bonds have a year-end fair value of matically indented when amount is entered. Do not nt titles and enter 0 for the amounts.) Brief Exercise 17-5 Blossom Corporation purchased 400 shares of Sherman Inc. common stock for $13,000 (Blossom does not have significant influence). During the year, Sherman paid a cash dividend of $3.00 per share. At year-end, Sherman stock was selling for $37.50 per share. Prepare Blossom' journal entries to record (a) the purchase of the investment, (b) the dividends received, and (c) the fair value adjustment. (Assume a zero balance in the Fair Value Adjustment account.) (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) No. a b c Account Titles and Explanation Debit Credit om does not have d, Sherman stock was ceived, and (c) the fair tles are automatically " for the account titles Brief Exercise 17-7 Sunland Corporation purchased for $326,000 a 30% interest in Murphy, Inc. This investment enables Sunland to exert signifi Murphy. During the year, Murphy earned net income of $174,000 and paid dividends of $60,000. Prepare Sunland's journal entries related to this investment. (Credit account titles are automatically indented when amount indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts Account Titles and Explanation (To record the purchase.) (To record the net income.) (To record the dividend.) Debit Credit t enables Sunland to exert significant influence over nd paid dividends of $60,000. matically indented when amount is entered. Do not titles and enter 0 for the amounts.) Brief Exercise 17-11 Larkspur Company invests $11,400,000 in 5% fixed rate corporate bonds on January 1, 2017. All the bonds are classified as par. At year-end, market interest rates have declined, and the fair value of the bonds is now $11,886,000. Inte Prepare journal entries for Larkspur Company to (a) record the transactions related to these bonds in 2017, assuming Larks (b) record the transactions related to these bonds in 2017, assuming that Larkspur Company elects the fair value option account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select enter 0 for the amounts.) No. Date Account Titles and Explanation Debit Credit Debit Credit (a) (To record interest revenue) (To record fair value adjustment) No. Date Account Titles and Explanation (b) (To record interest revenue) (To record fair value adjustment) All the bonds are classified as available-for-sale and are purchased at onds is now $11,886,000. Interest is paid on January 1. bonds in 2017, assuming Larkspur does not elect the fair option; and ny elects the fair value option to account for these bonds. (Credit If no entry is required, select "No Entry" for the account titles and Brief Exercise 17-13 Presented below are two independent cases related to available-for-sale debt investments. Case 1 Amortized cost Case 2 $41,170 $95,300 Fair value 32,020 106,120 Expected credit losses 26,790 87,440 For each case, determine the amount of impairment loss, if any. (If no loss, please enter 0. Do not leave any fields blank.) Case 1 Impairment Loss $ Case 2 Impairment Loss $ Exercise 17-12 The following are two independent situations. Situation 1 Bridgeport Cosmetics acquired 10% of the 191,000 shares of common stock of Martinez Fashion at a total cost of $14 per s Martinez declared and paid $81,300 cash dividend to all stockholders. On December 31, Martinez reported net income of 31, the market price of Martinez Fashion was $15 per share. Situation 2 Indigo, Inc. obtained significant influence over Seles Corporation by buying 30% of Seles's 32,500 outstanding shares of co share on January 1, 2017. On June 15, Seles declared and paid cash dividends of $37,700. On December 31, Seles report year. Prepare all necessary journal entries in 2017 for both situations. (Credit account titles are automatically indented when manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the am Date Account Titles and Explanation Debit Situation 1: Bridgeport Cosmetics Situation 2: Indigo, Inc Credit tuations. on at a total cost of $14 per share on March 18, 2017. On June 30, tinez reported net income of $118,600 for the year. At December s $15 per share. 500 outstanding shares of common stock at a total cost of $9 per n December 31, Seles reported a net income of $83,000 for the utomatically indented when amount is entered. Do not indent t titles and enter 0 for the amounts.) Exercise 17-18 Pronghorn Corporation has municipal bonds classified as a held-to-maturity at December 31, 2017. These bonds have a p $824,000, an amortized cost of $824,000, and a fair value of $736,000. The company believes that impairment accounti appropriate for these bonds. Prepare the journal entry to recognize the imp (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit (To record the impairment.) What is the new cost basis of the municipal bonds? New cost basis of the municipal bonds $ Given that the maturity value of the bonds is $824,000, should Pronghorn Corporation amortize the difference between the carrying amount and the maturity value over the life of the bonds? At December 31, 2018, the fair value of the municipal bonds is $776,000. Prepare the entry (if any) to record this information. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit 31, 2017. These bonds have a par value of lieves that impairment accounting is now urnal entry to recognize the impairment. manually. If no entry is required, select "No unts.) Exercise 17-27 On August 15, 2016, Nash Co. invested idle cash by purchasing a call option on Counting Crows Inc. common shares for $64 the call option is 720 shares, and the option price is $72. The option expires on January 31, 2017. The following data are av the call option. Date Market Price of Counting Time Value of Call Crows Shares Time Value of Call Option September 30, 2016 $86 per share $324 December 31, 2016 $83 per share 117 January 15, 2017 $85 per share 54 Prepare the journal entries for Nash for the following dates. (a) (b) (c) (d) Investment in call option on Counting Crows shares on August 15, 2016. September 30, 2016Nash prepares financial statements. December 31, 2016Nash prepares financial statements. January 15, 2017Nash settles the call option on the Counting Crows shares. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, s account titles and enter 0 for the amounts.) No. Date Account Titles and Explanation (a) (b) (To record the change in intrinsic value.) (To record the time value change.) (c) (To record the change in intrinsic value.) Debit Credit (To record the time value change.) (d) (To record the time value change.) (To record settlement of call option.) ws Inc. common shares for $648. The notional value of 017. The following data are available with respect to ually. If no entry is required, select "No Entry" for the Brief Exercise 116 On April 1, 2018, West Company purchased $422,000 of 6.75% bonds for $438,630 plus accrued interest as an ava is paid on July 1 and January 1 and the bonds mature on July 1, 2023. Prepare the journal entry on April 1, 2018. (Credit account titles are automatically indented when amount manually. If no entry is required, select "No Entry" for the account titles and enter 0 for Date Apr. 1, 2018 Account Titles and Explanation Debit Debt Investments $ 422,000 Interest Revenue (Accrued)422000*6.75%*3/12 $ 7,121 Cash The bonds are sold on November 1, 2019 at 103 plus accrued interest. Amortization was recorded when interest w method. Prepare all entries required to properly record the sale. (Credit account titles are automatically in entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and Round answers to 0 decimal places, e.g. 5,275.) Date Nov. 1, 2019 Account Titles and Explanation Interest Revenue-(438630-422000)*4/63 Debt Investments Debit $ 1,056 $ 9,495 $ 434,660 (To record amortization) Nov. 1, 2019 Cash-422000*6.75%*4/12 Interest Revenue (To record interest) Nov. 1, 2019 Cash-422000*103/100 Gain on sale of investments $ 1,045 Debt investments 438630-((438630422000)*19/63) From Apr'1, 2018 to July'1, 2023- A total of 63 month exists. The period of Apr'1, 2018 to Nov'1, 2019 is of 19 months. 438,630 plus accrued interest as an available-for-sale security. Interest e bonds mature on July 1, 2023. utomatically indented when amount is entered. Do not indent r the account titles and enter 0 for the amounts.) Credit $ 429,121 ortization was recorded when interest was received by the straight-line t account titles are automatically indented when amount is No Entry" for the account titles and enter 0 for the amounts. al places, e.g. 5,275.) Credit $ 1,056 $ 9,495 $ 433,615 r'1, 2018 to Nov'1, 2019 is of Exercise 123 On January 2, 2018, Tylor Company issued a 4-year, $600,000 note at 8% fixed interest, interest payable semiannually. Tylor now wants to change the note to a variable rate note. As a result, on January 2, 2018, Tylor Company enters into an interest rate swap where it agrees to receive 8% fixed and pay LIBOR of 5.6% for the first 6 months on $600,000. At each 6-month period, the variable interest rate will be reset. The variable rate is reset to 6.6% on June 30, 2018. Compute the net interest expense to be reported for this note and related swap transaction as of June 30, 2018. Net interest expense $ 16,800 Compute the net interest expense to be reported for this note and related swap transaction as of December 31, 2018. Net interest expense $ 19,800 Explanation June'30, 2018 Dec'31 , 2018 Fixed rate debt $ 600,000 $ 600,000 Fixed rate (8%/2) 4% 4% Semi Annual debt payme $ 24,000 $ 24,000 Swap fixed receipt $ 24,000 $ 24,000 Net income effect $ - $ Swap variable rate 5.6%*1/2*600000 $ 16,800 6.6%*1/2*600000 $ 19,800 Net Interest expenses $ 16,800 $ 19,800 t, interest payable semiannually. 2018, Tylor Company enters into e first 6 months on $600,000. At et to 6.6% on June 30, 2018. tion as of June 30, 2018. ction as of December 31, 2018. Brief Exercise 17-2 Sandhill Company purchased, on January 1, 2017, as an available-for-sale security, $68,000 of the 8%, 5-year bonds of Ches $62,845, which provides an 10% return. Prepare Sandhill's journal entries for (a) the purchase of the investment, (b) the receipt of annual interest and discount am end fair value adjustment. (Assume a zero balance in the Fair Value Adjustment account.) The bonds have a year-end fair va answers to 0 decimal places, e.g. 1,225. Credit account titles are automatically indented when amount is entered. Do not in is required, select "No Entry" for the account titles and enter 0 for the amounts.) No. a b c Account Titles and Explanation Debit Debt Investments (Available for sale) Cash (Bonds purchased) Cash- 8%*68,000 Debt Investments (Available for sale) Interest received-10% * 62,845 (Interest received) $ Fair value adjustment available for sales $ Unrealized holding gain(64600-62845-844.5) (To record fair value adjustment) $ $ Credit 62,845 $ 62,845 $ 6,285 $ 911 5,440 845 911 e 8%, 5-year bonds of Chester Corporation for l interest and discount amortization, and (c) the yearonds have a year-end fair value of $64,600. (Round mount is entered. Do not indent manually. If no entry Brief Exercise 17-5 Blossom Corporation purchased 400 shares of Sherman Inc. common stock for $13,000 (Blossom does not have significant the year, Sherman paid a cash dividend of $3.00 per share. At year-end, Sherman stock was selling for $37.50 per share. Prepare Blossom' journal entries to record (a) the purchase of the investment, (b) the dividends received, and (c) the fair va (Assume a zero balance in the Fair Value Adjustment account.) (Credit account titles are automatically indented when amo not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) No. a b c Account Titles and Explanation Equity investments-Trading Cash (Investment in Sherman Inc. stock) Cash (3*400) Dividend revenue (Dividend received) Fair value adjustment-Trading (37.5*40013000) Unrealised holding gain or loss -Income (To record fair value adjustment) Debit $ $ $ Credit 13,000 $ 13,000 $ 1,200 $ 2,000 1,200 2,000 does not have significant influence). During g for $37.50 per share. eceived, and (c) the fair value adjustment. cally indented when amount is entered. Do r the amounts.) Brief Exercise 17-7 Sunland Corporation purchased for $326,000 a 30% interest in Murphy, Inc. This investment enables Sunland to exert significan Murphy. During the year, Murphy earned net income of $174,000 and paid dividends of $60,000. Prepare Sunland's journal entries related to this investment. (Credit account titles are automatically indented when amount is e indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Equity investment Cash Debit $ Credit 326,000 $ 326,000 $ 52,200 $ 18,000 (To record the purchase.) Equity investment Revenue from investment $ 52,200 (To record the net income.) Cash Equity investment (To record the dividend.) $ 18,000 nables Sunland to exert significant influence over 00. tically indented when amount is entered. Do not r the amounts.) Brief Exercise 17-11 Larkspur Company invests $11,400,000 in 5% fixed rate corporate bonds on January 1, 2017. All the bonds are classified as par. At year-end, market interest rates have declined, and the fair value of the bonds is now $11,886,000. Interest is paid on Prepare journal entries for Larkspur Company to (a) record the transactions related to these bonds in 2017, assuming Larks (b) record the transactions related to these bonds in 2017, assuming that Larkspur Company elects the fair value option to account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "N enter 0 for the amounts.) No. (a) Account Titles and Explanation Date 5% J an. corporate 1, 2017 bonds -Available for sale Debit 11400000 Cash Dec. 31, 2017 I nterest rece Credit 11400000 570000 I nterest I ncome A/c 570000 (To record interest revenue) 5% corporate bonds -Available for sale 486000 Gain on AFS I nvestment ( (To record fair value adjustment) 486000 (As fair option is not elected , the investments will be classified as (AFS available for sale) and the changes in v No. (b) Date J an. 1, 2017 Account Titles and Explanation 5% Corporate Debit 11400000 Cash Dec. 31, 2017 I nterest rece Credit 11400000 570000 I nterest I nco 570000 (To record interest revenue) 5% Corporate Profit & Loss (To record fair value adjustment) 486000 486000 (As fair option is elected , the investments will be classified as (FVTPL - Fair value through Profit and loss a/c) and the chang All the bonds are classified as available-for-sale and are purchased at 11,886,000. Interest is paid on January 1. onds in 2017, assuming Larkspur does not elect the fair option; and elects the fair value option to account for these bonds. (Credit no entry is required, select "No Entry" for the account titles and 400000 0000 6000 sale) and the changes in value will be adjusted through OCI (Other Comprehensive Income) 400000 0000 6000 fit and loss a/c) and the changes in value will be adjusted through Income statement.) Brief Exercise 17-13 Presented below are two independent cases related to available-for-sale debt investments. Case 1 Amortized cost Case 2 $41,170 $95,300 Fair value 32,020 106,120 Expected credit losses 26,790 87,440 For each case, determine the amount of impairment loss, if any. (If no loss, please enter 0. Do not leave any fields blank.) Case 1 Impairment Loss 9150 $ Case 2 Impairment Loss 0 $ Asset impairment occurs when the fair market value of a fixed asset falls below the carrying value of the asset and the carrying value is not recoverable. Impairment Loss= Amortized costFair value Exercise 17-12 The following are two independent situations. Situation 1 Bridgeport Cosmetics acquired 10% of the 191,000 shares of common stock of Martinez Fashion at a total cost of $14 per s Martinez declared and paid $81,300 cash dividend to all stockholders. On December 31, Martinez reported net income of $ 31, the market price of Martinez Fashion was $15 per share. Situation 2 Indigo, Inc. obtained significant influence over Seles Corporation by buying 30% of Seles's 32,500 outstanding shares of com share on January 1, 2017. On June 15, Seles declared and paid cash dividends of $37,700. On December 31, Seles reported year. Prepare all necessary journal entries in 2017 for both situations. (Credit account titles are automatically indented when am manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Mar. 18, 2017 Account Titles and Debit Explanation Situation 1: Bridgeport Cosmetics Equity investm 2674000 Cash J une 30, 2017 Cash 2674000 8130 Dividend Reve Dec. 31, 2017 Fair value adj Credit 8130 191000 Unrealised holding gain or loss -I ncome 191000 Situation 2: Indigo, Inc Mar. 18, 2017 Equity investm 292500 Cash J une 15, 2017 Cash 292500 11310 Equity investm Dec. 31, 2017 Equity investm Revenue from 11310 24900 24900 on at a total cost of $14 per share on March 18, 2017. On June 30, nez reported net income of $118,600 for the year. At December 00 outstanding shares of common stock at a total cost of $9 per December 31, Seles reported a net income of $83,000 for the matically indented when amount is entered. Do not indent mounts.) Exercise 17-18 Pronghorn Corporation has municipal bonds classified as a held-to-maturity at December 31, 2017. These bonds have a pa $824,000, an amortized cost of $824,000, and a fair value of $736,000. The company believes that impairment accounting appropriate for these bonds. Prepare the journal entry to recognize the impair (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, s Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Loss on impa Debit Credit 88000 Available for s 88000 (To record the impairment.) What is the new cost basis of the municipal bonds? New cost basis of the municipal bonds $ 736000 Given that the maturity value of the bonds is $824,000, should Pronghorn Corporation amortize the difference between the carrying amount and the maturity value over the life of the bonds? No At December 31, 2018, the fair value of the municipal bonds is $776,000. Prepare the entry (if any) to record this information. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Securities fair Unrealised ho Debit Credit 40000 40000 1, 2017. These bonds have a par value of ves that impairment accounting is now nal entry to recognize the impairment. anually. If no entry is required, select "No Exercise 17-27 On August 15, 2016, Nash Co. invested idle cash by purchasing a call option on Counting Crows Inc. common shares for $64 the call option is 720 shares, and the option price is $72. The option expires on January 31, 2017. The following data are av the call option. Date Market Price of Counting Time Value of Call Crows Shares Time Value of Call Option September 30, 2016 $86 per share $324 December 31, 2016 $83 per share 117 January 15, 2017 $85 per share 54 Prepare the journal entries for Nash for the following dates. (a) (b) (c) (d) Investment in call option on Counting Crows shares on August 15, 2016. September 30, 2016Nash prepares financial statements. December 31, 2016Nash prepares financial statements. January 15, 2017Nash settles the call option on the Counting Crows shares. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, s account titles and enter 0 for the amounts.) No. (a) Date Aug. 15, 2016 Account Titles and Explanation Call option Debit 648 Cash (b) Sep. 30, 2016 Call Option Credit 648 (86-72)*720 10080 Unrealized Ho 10080 (To record the change in intrinsic value.) Unrealized Ho 648-324 324 Call Option 324 (To record the time value change.) (c) Dec. 31, 2016 Unrealized Ho Unrealized Ho 2160 J an. 15, 2017 Unrealized Ho Call Option 324-117 207 Call Option (To record the time value change.) (d) (86-83)*720 2160 Call Option (To record the change in intrinsic value.) 207 117-54 63 63 Call Option 63 (To record the time value change.) Cash (85-72)*720 9360 Gain on Settle 1386 Call Option 7974 (To record settlement of call option.) ws Inc. common shares for $648. The notional value of 017. The following data are available with respect to ually. If no entry is required, select "No Entry" for the (86-72)*720 (86-83)*720 (85-72)*720 Brief Exercise 116 On April 1, 2018, West Company purchased $422,000 of 6.75% bonds for $438,630 plus accrued interest as an ava is paid on July 1 and January 1 and the bonds mature on July 1, 2023. Prepare the journal entry on April 1, 2018. (Credit account titles are automatically indented when amount manually. If no entry is required, select "No Entry" for the account titles and enter 0 for Date Apr. 1, 2018 Account Titles and Explanation Debit Debt Investments $ 422,000 Interest Revenue (Accrued)422000*6.75%*3/12 $ 7,121 Cash The bonds are sold on November 1, 2019 at 103 plus accrued interest. Amortization was recorded when interest w method. Prepare all entries required to properly record the sale. (Credit account titles are automatically in entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and Round answers to 0 decimal places, e.g. 5,275.) Date Nov. 1, 2019 Account Titles and Explanation Interest Revenue-(438630-422000)*4/63 Debt Investments Debit $ 1,056 $ 9,495 $ 434,660 (To record amortization) Nov. 1, 2019 Cash-422000*6.75%*4/12 Interest Revenue (To record interest) Nov. 1, 2019 Cash-422000*103/100 Gain on sale of investments $ 1,045 Debt investments 438630-((438630422000)*19/63) From Apr'1, 2018 to July'1, 2023- A total of 63 month exists. The period of Apr'1, 2018 to Nov'1, 2019 is of 19 months. 438,630 plus accrued interest as an available-for-sale security. Interest e bonds mature on July 1, 2023. utomatically indented when amount is entered. Do not indent r the account titles and enter 0 for the amounts.) Credit $ 429,121 ortization was recorded when interest was received by the straight-line t account titles are automatically indented when amount is No Entry" for the account titles and enter 0 for the amounts. al places, e.g. 5,275.) Credit $ 1,056 $ 9,495 $ 433,615 r'1, 2018 to Nov'1, 2019 is of Exercise 123 On January 2, 2018, Tylor Company issued a 4-year, $600,000 note at 8% fixed interest, interest payable semiannually. Tylor now wants to change the note to a variable rate note. As a result, on January 2, 2018, Tylor Company enters into an interest rate swap where it agrees to receive 8% fixed and pay LIBOR of 5.6% for the first 6 months on $600,000. At each 6-month period, the variable interest rate will be reset. The variable rate is reset to 6.6% on June 30, 2018. Compute the net interest expense to be reported for this note and related swap transaction as of June 30, 2018. Net interest expense $ 16,800 Compute the net interest expense to be reported for this note and related swap transaction as of December 31, 2018. Net interest expense $ 19,800 Explanation June'30, 2018 Dec'31 , 2018 Fixed rate debt $ 600,000 $ 600,000 Fixed rate (8%/2) 4% 4% Semi Annual debt payme $ 24,000 $ 24,000 Swap fixed receipt $ 24,000 $ 24,000 Net income effect $ - $ Swap variable rate 5.6%*1/2*600000 $ 16,800 6.6%*1/2*600000 $ 19,800 Net Interest expenses $ 16,800 $ 19,800 t, interest payable semiannually. 2018, Tylor Company enters into e first 6 months on $600,000. At et to 6.6% on June 30, 2018. tion as of June 30, 2018. ction as of December 31, 2018. Brief Exercise 17-2 Sandhill Company purchased, on January 1, 2017, as an available-for-sale security, $68,000 of the 8%, 5-year bonds of Ches $62,845, which provides an 10% return. Prepare Sandhill's journal entries for (a) the purchase of the investment, (b) the receipt of annual interest and discount am end fair value adjustment. (Assume a zero balance in the Fair Value Adjustment account.) The bonds have a year-end fair va answers to 0 decimal places, e.g. 1,225. Credit account titles are automatically indented when amount is entered. Do not in is required, select "No Entry" for the account titles and enter 0 for the amounts.) No. a b c Account Titles and Explanation Debit Debt Investments (Available for sale) Cash (Bonds purchased) Cash- 8%*68,000 Debt Investments (Available for sale) Interest received-10% * 62,845 (Interest received) $ Fair value adjustment available for sales $ Unrealized holding gain(64600-62845-844.5) (To record fair value adjustment) $ $ Credit 62,845 $ 62,845 $ 6,285 $ 911 5,440 845 911 e 8%, 5-year bonds of Chester Corporation for l interest and discount amortization, and (c) the yearonds have a year-end fair value of $64,600. (Round mount is entered. Do not indent manually. If no entry Brief Exercise 17-5 Blossom Corporation purchased 400 shares of Sherman Inc. common stock for $13,000 (Blossom does not have significant the year, Sherman paid a cash dividend of $3.00 per share. At year-end, Sherman stock was selling for $37.50 per share. Prepare Blossom' journal entries to record (a) the purchase of the investment, (b) the dividends received, and (c) the fair va (Assume a zero balance in the Fair Value Adjustment account.) (Credit account titles are automatically indented when amo not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) No. a b c Account Titles and Explanation Equity investments-Trading Cash (Investment in Sherman Inc. stock) Cash (3*400) Dividend revenue (Dividend received) Fair value adjustment-Trading (37.5*40013000) Unrealised holding gain or loss -Income (To record fair value adjustment) Debit $ $ $ Credit 13,000 $ 13,000 $ 1,200 $ 2,000 1,200 2,000 does not have significant influence). During g for $37.50 per share. eceived, and (c) the fair value adjustment. cally indented when amount is entered. Do r the amounts.) Brief Exercise 17-7 Sunland Corporation purchased for $326,000 a 30% interest in Murphy, Inc. This investment enables Sunland to exert significan Murphy. During the year, Murphy earned net income of $174,000 and paid dividends of $60,000. Prepare Sunland's journal entries related to this investment. (Credit account titles are automatically indented when amount is e indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Equity investment Cash Debit $ Credit 326,000 $ 326,000 $ 52,200 $ 18,000 (To record the purchase.) Equity investment Revenue from investment $ 52,200 (To record the net income.) Cash Equity investment (To record the dividend.) $ 18,000 nables Sunland to exert significant influence over 00. tically indented when amount is entered. Do not r the amounts.) Brief Exercise 17-11 Larkspur Company invests $11,400,000 in 5% fixed rate corporate bonds on January 1, 2017. All the bonds are classified as par. At year-end, market interest rates have declined, and the fair value of the bonds is now $11,886,000. Interest is paid on Prepare journal entries for Larkspur Company to (a) record the transactions related to these bonds in 2017, assuming Larks (b) record the transactions related to these bonds in 2017, assuming that Larkspur Company elects the fair value option to account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "N enter 0 for the amounts.) No. (a) Account Titles and Explanation Date 5% J an. corporate 1, 2017 bonds -Available for sale Debit 11400000 Cash Dec. 31, 2017 I nterest rece Credit 11400000 570000 I nterest I ncome A/c 570000 (To record interest revenue) 5% corporate bonds -Available for sale 486000 Gain on AFS I nvestment ( (To record fair value adjustment) 486000 (As fair option is not elected , the investments will be classified as (AFS available for sale) and the changes in v No. (b) Date J an. 1, 2017 Account Titles and Explanation 5% Corporate Debit 11400000 Cash Dec. 31, 2017 I nterest rece Credit 11400000 570000 I nterest I nco 570000 (To record interest revenue) 5% Corporate Profit & Loss (To record fair value adjustment) 486000 486000 (As fair option is elected , the investments will be classified as (FVTPL - Fair value through Profit and loss a/c) and the chang All the bonds are classified as available-for-sale and are purchased at 11,886,000. Interest is paid on January 1. onds in 2017, assuming Larkspur does not elect the fair option; and elects the fair value option to account for these bonds. (Credit no entry is required, select "No Entry" for the account titles and 400000 0000 6000 sale) and the changes in value will be adjusted through OCI (Other Comprehensive Income) 400000 0000 6000 fit and loss a/c) and the changes in value will be adjusted through Income statement.) Brief Exercise 17-13 Presented below are two independent cases related to available-for-sale debt investments. Case 1 Amortized cost Case 2 $41,170 $95,300 Fair value 32,020 106,120 Expected credit losses 26,790 87,440 For each case, determine the amount of impairment loss, if any. (If no loss, please enter 0. Do not leave any fields blank.) Case 1 Impairment Loss 9150 $ Case 2 Impairment Loss 0 $ Asset impairment occurs when the fair market value of a fixed asset falls below the carrying value of the asset and the carrying value is not recoverable. Impairment Loss= Amortized costFair value Exercise 17-12 The following are two independent situations. Situation 1 Bridgeport Cosmetics acquired 10% of the 191,000 shares of common stock of Martinez Fashion at a total cost of $14 per s Martinez declared and paid $81,300 cash dividend to all stockholders. On December 31, Martinez reported net income of $ 31, the market price of Martinez Fashion was $15 per share. Situation 2 Indigo, Inc. obtained significant influence over Seles Corporation by buying 30% of Seles's 32,500 outstanding shares of com share on January 1, 2017. On June 15, Seles declared and paid cash dividends of $37,700. On December 31, Seles reported year. Prepare all necessary journal entries in 2017 for both situations. (Credit account titles are automatically indented when am manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Mar. 18, 2017 Account Titles and Debit Explanation Situation 1: Bridgeport Cosmetics Equity investm 2674000 Cash J une 30, 2017 Cash 2674000 8130 Dividend Reve Dec. 31, 2017 Fair value adj Credit 8130 191000 Unrealised holding gain or loss -I ncome 191000 Situation 2: Indigo, Inc Mar. 18, 2017 Equity investm 292500 Cash J une 15, 2017 Cash 292500 11310 Equity investm Dec. 31, 2017 Equity investm Revenue from 11310 24900 24900 on at a total cost of $14 per share on March 18, 2017. On June 30, nez reported net income of $118,600 for the year. At December 00 outstanding shares of common stock at a total cost of $9 per December 31, Seles reported a net income of $83,000 for the matically indented when amount is entered. Do not indent mounts.) Exercise 17-18 Pronghorn Corporation has municipal bonds classified as a held-to-maturity at December 31, 2017. These bonds have a pa $824,000, an amortized cost of $824,000, and a fair value of $736,000. The company believes that impairment accounting appropriate for these bonds. Prepare the journal entry to recognize the impair (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, s Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Loss on impa Debit Credit 88000 Available for s 88000 (To record the impairment.) What is the new cost basis of the municipal bonds? New cost basis of the municipal bonds $ 736000 Given that the maturity value of the bonds is $824,000, should Pronghorn Corporation amortize the difference between the carrying amount and the maturity value over the life of the bonds? No At December 31, 2018, the fair value of the municipal bonds is $776,000. Prepare the entry (if any) to record this information. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Securities fair Unrealised ho Debit Credit 40000 40000 1, 2017. These bonds have a par value of ves that impairment accounting is now nal entry to recognize the impairment. anually. If no entry is required, select "No Exercise 17-27 On August 15, 2016, Nash Co. invested idle cash by purchasing a call option on Counting Crows Inc. common shares for $64 the call option is 720 shares, and the option price is $72. The option expires on January 31, 2017. The following data are av the call option. Date Market Price of Counting Time Value of Call Crows Shares Time Value of Call Option September 30, 2016 $86 per share $324 December 31, 2016 $83 per share 117 January 15, 2017 $85 per share 54 Prepare the journal entries for Nash for the following dates. (a) (b) (c) (d) Investment in call option on Counting Crows shares on August 15, 2016. September 30, 2016Nash prepares financial statements. December 31, 2016Nash prepares financial statements. January 15, 2017Nash settles the call option on the Counting Crows shares. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, s account titles and enter 0 for the amounts.) No. (a) Date Aug. 15, 2016 Account Titles and Explanation Call option Debit 648 Cash (b) Sep. 30, 2016 Call Option Credit 648 (86-72)*720 10080 Unrealized Ho 10080 (To record the change in intrinsic value.) Unrealized Ho 648-324 324 Call Option 324 (To record the time value change.) (c) Dec. 31, 2016 Unrealized Ho Unrealized Ho 2160 J an. 15, 2017 Unrealized Ho Call Option 324-117 207 Call Option (To record the time value change.) (d) (86-83)*720 2160 Call Option (To record the change in intrinsic value.) 207 117-54 63 63 Call Option 63 (To record the time value change.) Cash (85-72)*720 9360 Gain on Settle 1386 Call Option 7974 (To record settlement of call option.) ws Inc. common shares for $648. The notional value of 017. The following data are available with respect to ually. If no entry is required, select "No Entry" for the (86-72)*720 (86-83)*720 (85-72)*720