Question
On July 1, 2019, Slick Rocks, Inc., purchased at par $350,000, 6 percent bonds of Sandstone Company for the trading securities portfolio. The bonds pay
On July 1, 2019, Slick Rocks, Inc., purchased at par $350,000, 6 percent bonds of Sandstone Company for the trading securities portfolio. The bonds pay interest each June 30 and December 31. Slick Rocks fiscal year ends on December 31. The following information pertains to the price of the Sandstone bonds: Bond Price 12/31/2019 $ 356,000 12/31/2020 352,000 Slick Rocks sold the Sandstone bonds on June 30, 2021, at a price of $353,000. Prepare any journal entries that are required by the facts presented in the case. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
July 1, 2019 / Record the purchase of $350,000 investments at par on July 1, 2019.
December 31, 2019 / Record the interest received for the period ending December 31, 2019.
December 31, 2019 / Recognize the fair value of investments on December 31, 2019.
June 30, 2020 / Record the interest received for the period ending June 30, 2020.
December 31, 2020 / Record the interest received for the period ending December 31, 2020.
December 31, 2020 / Recognize the fair value of investments on December 31, 2020.
June 31, 2021 / Record the interest received for the period ending June 30, 2021.
June 30, 2021 / Record the gain on sale of $353,000 investments on June 30, 2021.
June 30, 2021 / Record the gain on sale of $353,000 investments on June 30, 2021.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Financial Accounting A Decision Making Approach
Authors: Thomas E. King, Valdean C. Lembke, John H. Smith
2nd Edition
0471328235, 978-0471328230
