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Statement of Problem On January 1. 2015, the XYZ company purchase the following to Available for Sale Investments 1) The bonds of the ABC company,

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Statement of Problem On January 1. 2015, the XYZ company purchase the following to Available for Sale Investments 1) The bonds of the ABC company, with a face value of $100,000, a nominal rate of 5%, a yield rate of 7% and a 3 year term. The bonds pay interest on January 1 of each year. 2) Stock in the Cozy Corporation. These shares were purchased at a price of $75,000. During the following 2 years, the fair market values of these investments were as follows: Bonds:1/1/16- 35,000; 1/1/17- $89,000 Stocks:1/1/16- $96,000; 1/1/17- $1,500 On the attached answer sheet, please provide the amortization table for the bonds as well as all journal entries for the bonds and stocks for 1/1/15, 1/1/16, 1/1/17 1) Amortization for the bonds 2) Journal Entries for 1/1/15: Entry to record Purchase of Bonds Entry to record Purchase of stocks 3) Journal Entries for 1/1/16 Entries to record interest revenue and FMV adjustment on Bonds Entry to record FMV adjustment on stocks. 4) Journal Entries for 1/1/17 Entries to record interest revenue and FMV adjustment on Bonds Entry to record FMV adjustment on stocks

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