Non-Strategic Investments

CHECK FIGURE: Feb.16,2024, Investment Income=$100 Huang Hardware Inc. had the following transactions involving non-strategic investments during 2023. 2023 Feb 1. Paid $70,000 to buy a 60-day term deposit $70,000 principal amount, 6.23%,dated Feb 1. 21 Purchased 6,000 common shares of Hilton Ltd at $11.25. Apr. 2. Received a cheque for the principal and accrued interest on the term deposit that matured today. 15. Purchased 8,200 common shares of Elder Corp at $9.75. 1 Purchased for $67,069 a 6.8%, $68,000 Baker Inc, bond that matures in four years when the market interest rate was 7.2%. Interest is paid semiannually beginning December 31,2023. Huang Inc. plans to hold this investment until maturity. 15. Received a 0.30 per share cash dividend on the Hilton common shares. 28.Sold 4,000 of the Hilton common shares at $11.15. Dec 1. Received a 0.30 per share dividend on the remaining Hilton common shares owned. 31. Received the interest on the Barker. bond. 31. The fair values of Huang Hardware Inc's investments ib this date were Hilton shares, $12.60; Elder shares, $10.30; Venture shares, $3.20. Assume the fair value and carrying value of the Baker bond were equal. 2024 16. Sold the remaining Hilton shares at $12.65 less a transaction fee if $200. Required 1. Prepare an amortization schedule for the Barker bond showing only 2023 and 2024. 2. Prepare journal entries to record the preceding transactions. 3. Show how Huang Hardware Inc's investments will appear on its December 31,2023, balance sheet. Analysis Component: Huang Hardware Inc. purchased the Barker Inc. bond for less than face value. Explain why.