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Problem 1 2 - 1 ( Static ) Securities held - to - maturity; bond investment; effective interest; financial statement effects LO 1 2 -
Problem Static Securities heldtomaturity; bond investment; effective interest;
financial statement effects LO
Fuzzy Monkey Technologies, Incorporated purchased as a longterm investment $ million of bonds,
dated January on January Management has the positive intent and ability to hold the bonds until
maturity. For bonds of similar risk and maturity the market yield was The price paid for the bonds was $
million. Interest is received semiannually on June and December Due to changing market conditions, the
fair value of the bonds at December was $ million.
Required:
to Prepare the relevant journal entries on the respective dates record the interest at the effective rate
At what amount will Fuzzy Monkey report its investment in the December balance sheet?
How would Fuzzy Monkey's statement of cash flows be affected by this investment? If more than one
approach is possible, indicate the one that is most likely.
Complete this question by entering your answers in the tabs below.
Req to
Prepare the relevant journal entries on the respective dates record the interest at the effective rate
Note: If no entry is required for a transactionevent select No journal entry required" in the first account field. Entel
millions rounded to decimal places, ie should be entered as
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