Exercise 12-12 (Algo) Available-for-sale securities; financial statement effects [LO12-1, 12-4]Colah Company purchased $2,300,000 of Jackson, Incorporated, 6% bonds at par on July 1, 2024, with Interestpaid semi-annually. Colah determined that it should account for the bonds as an available-for-sale Investment. AtDecember 31, 2024, the Jackson bonds had a fair value of $2,630,000. Colah sold the Jackson bonds on July 1,2025 for $2,070,000.Required:1. Prepare Colah's Journal entries for the following transactions:a. The purchase of the Jackson bonds on July 1.b. Interest revenue for the last half of 2024.c. Any year-end 2024 adjusting entries.d. Interest revenue for the first half of 2025.e. Any entries necessary upon sale of the Jackson bonds on July 1, 2025, Including updating the fair-valueadjustment, recording any reclassification adjustment, and recording the sale.2. Complete the following table to show the effect of the Jackson bonds on Colah's net income, othercomprehensive Income, and comprehensive Income for 2024, 2025, and cumulatively over 2024 and 2025.Complete this question by entering your answers in the tabs below.Required 1 Required 2Prepare Colah's journal entries for the following transactions:a. The purchase of the Jackson bonds on July 1.b. Interest revenue for the last half of 2024.c. Any year-end 2024 adjusting entries.d. Interest revenue for the first half of 2025.e. Any entries necessary upon sale of the Jackson bonds on July 1, 2025, including updating the fair-value adjustment, recreclassification adjustment, and recording the sale.Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter yourwhole dollars, and not in millions.View transaction listJournal entry worksheet1 2 3 4567

Securities or bonds which are available for sale have a different approach of recording which is the…

Colah Company purchased $2,300,000 of Jackson, Incorporated, 6% bonds at par on July 1, 2024, with Interest paid semi-annually. Colah determined that it should account for the bonds as an available-for-sale Investment. At December 31, 2024, the Jackson bonds had a fair value of $2,630,000. Colah sold the Jackson bonds on July 1, 2025 for $2,070,000. Required: 1. Prepare Colah's Journal entries for the following transactions: a. The purchase of the Jackson bonds on July 1. b. Interest revenue for the last half of 2024. c. Any year-end 2024 adjusting entries. d. Interest revenue for the first half of 2025. e. Any entries necessary upon sale of the Jackson bonds on July 1, 2025, Including updating the fair-value adjustment, recording any reclassification adjustment, and recording the sale.

Colah Company purchased $2,300,000 of Jackson, Incorporated, 6% bonds at par on July 1, 2024, with Interest paid semi-annually. Colah determined that it should account for the bonds as an available-for-sale Investment. At December 31, 2024, the Jackson bonds had a fair value of $2,630,000. Colah sold the Jackson bonds on July 1, 2025 for $2,070,000. Required: 1. Prepare Colah's Journal entries for the following transactions: a. The purchase of the Jackson bonds on July 1. b. Interest revenue for the last half of 2024. c. Any year-end 2024 adjusting entries. d. Interest revenue for the first half of 2025. e. Any entries necessary upon sale of the Jackson bonds on July 1, 2025, Including updating the fair-value adjustment, recording any reclassification adjustment, and recording the sale.

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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