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(a.) Prepare any journal entries you consider necessary, including year end entries (December 31), assuming these investments are managed to profit from changes in market interest rates (held for trading). Mayor Company doesn’t have debt investment before 2020. (b.) Prepare a partial statement of financial position showing the Investment account at December 31, 2020. (c.) If Mayor Company purchase the debt investment to collect the contractual cash flow (held the debt investment to maturity), explain how the journal entries would differ from those in part (a).

(a.) Prepare any journal entries you consider necessary, including year end entries (December 31), assuming these investments are managed to profit from changes in market interest rates (held for trading). Mayor Company doesn’t have debt investment before 2020. (b.) Prepare a partial statement of financial position showing the Investment account at December 31, 2020. (c.) If Mayor Company purchase the debt investment to collect the contractual cash flow (held the debt investment to maturity), explain how the journal entries would differ from those in part (a).

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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(a.) Prepare any journal entries you consider necessary, including year end entries (December 31), assuming these investments are managed to profit from changes in market interest rates (held for trading). Mayor Company doesn’t have debt investment before 2020.

(b.) Prepare a partial statement of financial position showing the Investment account at December 31, 2020.

(c.) If Mayor Company purchase the debt investment to collect the contractual cash flow (held the debt investment to maturity), explain how the journal entries would differ from those in part (a).

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