Presented below is an amortization schedule related to Stock Companys 5-year, $200,000 bond with a 7% stated interest rate and a 5% market interest rate yield, purchased on December 31, 2017, for $217,320. The interest is paid each December 31, and the investor receives the first interest payment on Dec 31, 2018.

The following schedule presents the fair value of the bonds at year-end.

	31.12.2018	31.12.2019
Fair value	213,000	215,000

Required:

1. Prepare the journal entries related to bonds for 2017 and 2018 assuming the bonds are classified as financial assets at amortized cost.

2. Prepare the journal entries related to the fair value adjustment for the bonds on 31 December 2019 assuming these bonds are classified as financial assets at fair value through profit or loss (FVTPL).

3. Prepare the journal entries related to the fair value adjustment for 2018 and sale of bonds for 2019 assuming these bonds are classified as financial assets at fair value through other comprehensive income (FVTOCI). The bonds are sold at the fair value on 31 December 2019.