Postage People Corporation generated excess cash and invested in securities as follows:

Requirement 1: Classify each of the investments made during 2018. (Assume the investments represent less than 20% of ownership of outstanding voting stock.)

Options for classification and reason for requirement 1:

Requirement 2: Joirnalize the 2018 transactions. Explanations are not required ( Record debits first, then credits. Exclude explanations from the journal entries. If no entry is required, select No entry required on the first line of the Accounts column and leave the remaing cells blank.)

Jul 2: Purchased 2,600 shares of Lexi, Inc. common stock at $11.00 per share. Postage People plans to sell the stock within three months, when the company will need the cash for normal operations, Postage People does not have significant influence over Lexi.

Account options for above:

Requirement 3: Prepare T-accounts for the investment assets and show how to report the investments on Postage Peoples balance sheet at December 31,2018.

Begin by preparing T-accounts for the investment assets that are remaining at December 31,2018. (Select the investment account first l, then the fair value adjustment account. If no fair value account is needed, leave that T-account heading and the remaing cells blank.)

Options for T-account :

Use the partial balance sheet below to show how to report the investments on Postage Peoples balance sheet at December 31,2018. ( If a box is not used in the balance sheet, leave the box empty; do not select a label or enter a zero)

Requirement 4: where is the unrealized holding gain or loss associated with the trading debt investment reported?

The unrealized holding gain (loss) associated with the trading debt investment is included in the _______. (A. Accumulated other comprehensive income section on the balance sheet. B. Balance sheet as a contra account to the trading debt investment account. C.revenues section of the income statement D. Other income and (expense) section on the income statement)

1 Requirements 1. Classify each of the investments made during 2018. (Assume the equity investments represent less than 20% of ownership of outstanding voting stock.) 2. Journalize the 2018 transactions. Explanations are not required. 3. Prepare T-accounts for the investment assets, and show how to report the investments on Postage People's balance sheet at December 31, 2018 Where is the unrealized holding gain or loss associated with the trading debt investment reported? 4. Requirement 1 . Classify each of the investments made during 2018 Assume the investments represent less than 20% of ownership of Classification Reason Lexi stock Solane bond Classification Available-for-Sale Debt Investment Controlling interest equity investment Held-to-Maturity Debt Investment No Significant interest equity investment Significant interest equity investment Trading Debt Investment Reason Intent is to hold for less than a year Intent is to hold for several years. Investment will be held to maturity ownership is between 20% and 50% of total oustanding stock. Ownership is greater than 50% of total outstanding stock. Ownership is less than 20% of total oustanding stock. Jul. 2: Purchased 2.600 shares of Lexi, Inc. common stock at $11.00 per share. Postage People plans to sell the stock wi Date Accounts Debit Credit Jul. 2 Aug. 21: Received a cash dividend of $0.90 per share on the Lexi stock investment. Date Accounts Debit Credit Aug. 21 Dec. 31: Adjusted the Solane bond to its market value of $42,000 Date Accounts Debit Credit Dec. 31 Accounts No entry required Available-for-Sale Debt Investments Cash Dividend Revenue Equity Investments Fair Value Adjustment-Available-for-Sale Fair Value Adjustment-Equity Investments Fair Value Adjustment-Held-to-Maturity Fair Value Adjustment-Trading Gain on Disposal Held-to-Maturity Debt Investments Interest Revenue Trading Debt Investments Unrealized Holding Gain-Available-for-Sale Unrealized Holding Gain-Equity Investments Unrealized Holding Gain- Held-to-Maturity Unrealized Holding Gain-Trading Unrealized Holding Loss-Available-for-Sale Unrealized Holding Loss-Equity Investments Unrealized Holding Loss-Held-to-Maturity Unrealized Holding Loss-Trading Available-for-Sale Debt Investments Equity Investments Held-to-Maturity Debt Investments Trading Debt Investments Jul. 2 Sep. 16 Oct. 1 Dec. 31 rt the investments Postage People Corporation Balance Sheet (Partial) December 31, 2018 Current Assets: Long-Term Assets: Accumulated Other Comprehensive Income (Loss) Available-for-Sale Debt Investments (at cost) Available-for-Sale Debt Investments (at fair value) Dividend Revenue Equity Investments Held-to-Maturity Debt Investments Investment Revenue Trading Debt Investments (at cost) Trading Debt Investments (at fair value) Unrealized Holding Gain (Loss)-Available-for-Sale Unrealized Holding Gain (Loss-Equity Investments Unrealized Holding Gain (Loss Held-to-Maturity Unrealized Holding Gain (Loss)-Trading stments on Pos Long-Term Assets