Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On February 1, 2018, Hill Co. decides to invest excess cash of $17,000 by purchasing a Hunter, Inc. bond at face value. At year-end, December

image text in transcribed
image text in transcribed
image text in transcribed
On February 1, 2018, Hill Co. decides to invest excess cash of $17,000 by purchasing a Hunter, Inc. bond at face value. At year-end, December 31, 2018, the fair value of the Hunter bond was $20,900. The investment is categorized as a trading debt investment. Read the requirements Requirement 1. Journalize the transactions for Hill's Investment in Hunter, Inc. for 2018. (Record debits first, then credits. Select the explanation on the last line of the journal entry table. If no entry is required, select "No entry required on the first line of the Accounts and Explanation column and leave the romaining cels blank.) Begin by journalizing Hill's investment in the Hunter, Inc., bond, Accounts and Explanation Debit Credit Date Fob. 1 Journalize the adjustment, if required, at year-end, December 31, 2018. Hunter's market price was $20,900 per share. Debit Accounts and Explanation Dato Credit Dec. 31 Requirement 2. In what category and at what value would Hill report the asset on the December 31, 2018, balance sheet? In what account would the market price change in Hunter's bond be reported, if at all? Hill would report the asset at 1. classified as a on the balance sheet as of December 31, 2018. The market price change would Requirement 3. What was the net effect of the investment on Hil's net income for the year ended December 31, 2018? (Enter "0" as the amount it net income has not changed.) Hill's net income for the year ended Decembor 31, 2018, has The amount by which net income has changed Requirements 1. Journalize the transactions for Hill's investment in Hunter, Inc. for 2018. 2. In what category and at what value would Hill report the asset on the December 31, 2018, balance sheet? In what account would the market price change in Hunter's bond be reported, if at all? 3. What was the net effect of the investment on Hill's net income for the year ended December 31, 2018? Print Done

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting In A Nutshell Accounting For The Non-specialist

Authors: Walker, Janet

3rd Edition

075068738X, 9780750687386

More Books

Students also viewed these Accounting questions

Question

=+e) What probably happened to earnings after the initial 17 days?

Answered: 1 week ago

Question

12. What are their values? (ethical stance in society)

Answered: 1 week ago