Question
Case 10-5 Accounting for an Available-For-Sale Debt Securities Bentley Company acquires Joslyn Company debt securities on January 1, 2020 for $15.000. Upon acquisition, Bentley Company
Case 10-5 Accounting for an Available-For-Sale Debt Securities
Bentley Company acquires Joslyn Company debt securities on January 1, 2020 for $15.000. Upon acquisition, Bentley Company designates the securities as available for sale. Bentley Company sells the Joslyn Company debt securities for $20,000 on February 1, 2021.
The following table summarizes the fair value of the Joslyn Company debt securities over the holding period.
Date Fair value
1/1/2020 $15,000
12/31/2020 18,000
2/1/2021 20,000
Required:
How should Bentley Company record the:
A. Acquisition of the debt securities
B. Subsequent changes in fair value of the debt securities
C. Disposition of the debt securities?
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