On January 1, 2018, Jonas Bros. Inc. (JBI) purchased 5,000 shares of Han-A Bros. Inc. (HAB) at a total cost of $1,000,000 and has the intent to trade them actively and opts for fair value through net income. Both companies follow IFRS.

The following information relates to the HAB security:

On June 30, 2018, each HAB share was trading at $212.

On June 30, 2019, each HAB share was trading at $182.

On June 30, 2020 JBI sells half of the HAB shares at $195.

Assume JBI has a June 30 year end.

Required:Given the above information, do the following:

a.Prepare the journal entry(ies) for the transaction that occurred on January 1, 2018.

b.Prepare the required journal entry(ies) for 2019.

c.Prepare the required journal entry(ies) for 2020.

Part B- 9 Marks

A company purchased a $900,000, 5%, 10-year bond yielding 4% on July 1, 2019.

Interest is to be paid semi-annually on January 1 and July 1. The company uses FV-NI

for Bond investments and has a December 31 year end.

Required:

a.Determine the purchase price of the bond.

b.Prepare the journal entry to record the bond investment on July 1, 2019.

c.Prepare the required journal entry(ies) on December 31, 2019. The bond is quoted at a value of 101 on that date.

d.Prepare the required journal entry(ies) on December 31, 2020. The bond is quoted at a value of 99 on that date.