Question
During 20X1, Marten purchased $100,000 face amount bonds at a premium and classifies them as available-for-sale investment. On 12/31/20X1 after recognizing interest income and amortization,
During 20X1, Marten purchased $100,000 face amount bonds at a premium and classifies them as available-for-sale investment. On 12/31/20X1 after recognizing interest income and amortization, the carrying value of the bonds is $101,300 and the market value is $101,900. What additional journal entry related to the bond investment should Marten make on 12/31/20X1?
Multiple Choice
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Fair value adjustmentAvailable-for-Sale Securities 600 OCI--Unrealized Gain or Loss in Fair Value of Available-for-Sale Securities 600 -
Fair value adjustmentAvailable-for-Sale Securities 600 Gain on Available-for-Sale Securities 600 -
Fair value adjustmentAvailable-for-Sale Securities 1,900 Gain on Available-for-Sale Securities 1,900 -
Fair value adjustmentAvailable-for-Sale Securities 1,900 OCI--Unrealized Gain or loss in Fair value of Available-for-Sale 1,900
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Auditing A Complete Guide Practical Tools For Self Assessment
Authors: Gerardus Blokdyk
1st Edition
0655424571, 978-0655424574
