The information below relates to Milton Company's trading securities in 2012 and 2013. (a) Prepare the journal entries for the following transactions. January 1, 2012 Purchased $300,000 par value of GLF Company bonds at 97 plus accrued interest. The bonds pay interest annually at 9% each December 31. Broker's commission was $3,000. September 1, 2012 Sold $150,000 par value of GLF Company bonds at 94 plus accrued interest. Broker's commission, taxes, and fees were $1,500. September 5, 2012 Purchased 5,000 shares of Hayes, Inc. common stock for $30 per share. The broker's commission on the purchase amounted to $2,000. December 31, 2012 Make the appropriate entry for the GLF Company bonds. December 31, 2012 The market prices of the trading securities at December 31 were: Hayes, Inc. common stock, $31 per share; and GLF Company bonds, 99. Make the appropriate entry. July 1, 2013 Milton sold 1/2 of the Hayes, Inc. common stock at $32 per share. Broker's commissions, taxes, and fees were $1,000. December 1, 2013 Milton purchased 600 shares of Ramirez, Inc. common stock at $45 per share. Broker's commission was $500. December 31, 2013 Make the appropriate entry for the GLF Company bonds. December 31, 2013 The market prices of the trading securities at December 31 were: Hayes, Inc. common stock, $34 per share; GLF Company bonds, 98; and Ramirez, Inc. common stock, $47 per share. Make the appropriate entry. Problem D-VIII Solution. January 1, 2012* Debt Investments ($300,000 .97) + $3,000 294,000 Cash 294,000 September 1, 2012 Cash ($141,000 + $9,000 $1,500) 148,500 Loss on Sale of Investments 7,500 Debt Investments 147,000 Interest Revenue 9,000 September 5, 2012 Equity Investments 152,000 Cash 152,000 December 31, 2012* Cash ($150,000 .09) 13,500 Interest Revenue 13,500 December 31, 2012 Fair Value Adjustment (Trading) 4,500 Unrealized Holding Gain or LossIncome ($299,000 $303,500) 4,500 July 1, 2013 Cash ($80,000 $1,000) 79,000 Gain on Sale of Investments 3,000 Equity Investments 76,000 December 1, 2013 Equity Investments 27,500 Cash 27,500 December 31, 2013 Cash 13,500 Interest Revenue 13,500 December 31, 2013 Fair Value Adjustment (Trading) 14,200 Unrealized Holding Gain or LossIncome 14,200 ($326,500 $345,200) - $4,500 I have 2 questions related to the solution to this problem. #1- Why is the accrued interest not booked for the January 1, 2012 journal entry? Question 2- Determination of the $326,500 and $345,200 in calculating the unrealized holding gain or loss? I get a cost of $250,500 and FMV of $260,200. It appears as if the difference may related to the Hayes stock but 1/2 was sold