Fuzzy Monkey Technologies Inc purchased as a long-term investmetn S60 million of 6% bonds, dated Jan 1, on Jan 1 2021. Management has the positive intent and ability to hold the bonds until maturity. For bonds of similar risk and maturity the market yield was 8%. The price paid for the bonds was $46 million. Interest is received semianually on June 30 and Dec 31. Due to changing market conditions the fair value of the bonds at Dec 31 2021 was $50 million. 1 to 3. Prepare the relevant journal entries on the respective dates. 4. At what amount will Fuzzy Monkey report its investment in Dec 31, 2021 balance sheet? 5. How would Fuzzy Monkey's 2021 statement of cash flows be affected by this investment?

Fuzzy Monkey Technologies Inc purchased as a long-term investmetn S60 million of 6% bonds, dated Jan 1, on Jan 1 2021. Management has the positive intent and ability to hold the bonds until maturity. For bonds of similar risk and maturity the market yield was 8%. The price paid for the bonds was $46 million. Interest is received semianually on June 30 and Dec 31. Due to changing market conditions the fair value of the bonds at Dec 31 2021 was $50 million. 1 to 3. Prepare the relevant journal entries on the respective dates. 4. At what amount will Fuzzy Monkey report its investment in Dec 31, 2021 balance sheet? 5. How would Fuzzy Monkey's 2021 statement of cash flows be affected by this investment?

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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