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Safety Development Corporation had relatively large idle cash balances and invested them as follows in securities to be held as non- strategic investments: 2023 7 Purchased 3,100 common shares of Royal Bank at $27.40, plus $500 in transaction fees. 19 Purchased 2,100 common shares of Imperial Oil at $54.00, and paid $250 in transaction fees. Apr. 1 Paid $97,182 plus $500 in transaction fees for a 8.60%, four-year, $99,000 Minco Inc. bond that pays interest quarterly beginning June 30. The market rate of interest on this date was 9.00%. Sellers Corporation plans to hold this investment for the duration of the bond's contract life. Feb. May 26 Purchased 2,900 common shares of BCE at $14.28, plus $200 in transaction fees. June 1 Received a $0.25 per share cash dividend on the Royal Bank common shares. 17 Sold 2,100 Royal Bank common shares at $27.90. 30 Received interest on the Minco Inc. bond. Aug. 5 Received a $0.50 per share cash dividend on the Imperial 011 common shares. Sept. 1 Received a $0.275 per share cash dividend on the remaining Royal Bank common shares. 30 Received interest on the Minco Inc. bond. Dec. 31 Received interest on the Minco Inc. bond. On December 31, 2023, the fair values of the investments held by Safety Development Corporation were: Royal Bank, $28.40; Imperial Oil, $52.38; and BCE, $14.40. Assume the fair value and carrying value of the Minco Inc. bond were equal. Required: 1. Prepare an amortization schedule for the Minco Inc. bond showing only 2023. (Round your intermediate and final answers to the nearest whole dollar amount. Enter all the amounts as positive values.) Cash

Safety Development Corporation had relatively large idle cash balances and invested them as follows in securities to be held as non- strategic investments: 2023 7 Purchased 3,100 common shares of Royal Bank at $27.40, plus $500 in transaction fees. 19 Purchased 2,100 common shares of Imperial Oil at $54.00, and paid $250 in transaction fees. Apr. 1 Paid $97,182 plus $500 in transaction fees for a 8.60%, four-year, $99,000 Minco Inc. bond that pays interest quarterly beginning June 30. The market rate of interest on this date was 9.00%. Sellers Corporation plans to hold this investment for the duration of the bond's contract life. Feb. May 26 Purchased 2,900 common shares of BCE at $14.28, plus $200 in transaction fees. June 1 Received a $0.25 per share cash dividend on the Royal Bank common shares. 17 Sold 2,100 Royal Bank common shares at $27.90. 30 Received interest on the Minco Inc. bond. Aug. 5 Received a $0.50 per share cash dividend on the Imperial 011 common shares. Sept. 1 Received a $0.275 per share cash dividend on the remaining Royal Bank common shares. 30 Received interest on the Minco Inc. bond. Dec. 31 Received interest on the Minco Inc. bond. On December 31, 2023, the fair values of the investments held by Safety Development Corporation were: Royal Bank, $28.40; Imperial Oil, $52.38; and BCE, $14.40. Assume the fair value and carrying value of the Minco Inc. bond were equal. Required: 1. Prepare an amortization schedule for the Minco Inc. bond showing only 2023. (Round your intermediate and final answers to the nearest whole dollar amount. Enter all the amounts as positive values.) Cash

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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2. Prepare journal entries to record the investment activity including the appropriate fair value adjustment on December 31. (Round your intermediate and final answers to the nearest whole dollar amount.) View transaction list Journal entry worksheet < 1 2 Date Feb 07, 2023 Record the purchase of investment. Note: Enter debits before credits. Assets Record entry 3 Show Transcribed Text 4 Current Investments: Non-current investments 5 General Journal Clear entry SAFETY DEVELOPMENT CORPORATION Partial Balance Sheet December 31, 2023 6 7 J 8 Debit 12 3. Show how the investments will be reported on the December 31, 2023, balance sheet. (Round your intermediate and final answers to the nearest whole dollar amount.) Credit View general journal > Analysis Component: If the fair value adjustment is not recorded by Safety Development Corporation, what is the impact on the financial statements?
Transcribed Image Text:2. Prepare journal entries to record the investment activity including the appropriate fair value adjustment on December 31. (Round your intermediate and final answers to the nearest whole dollar amount.) View transaction list Journal entry worksheet < 1 2 Date Feb 07, 2023 Record the purchase of investment. Note: Enter debits before credits. Assets Record entry 3 Show Transcribed Text 4 Current Investments: Non-current investments 5 General Journal Clear entry SAFETY DEVELOPMENT CORPORATION Partial Balance Sheet December 31, 2023 6 7 J 8 Debit 12 3. Show how the investments will be reported on the December 31, 2023, balance sheet. (Round your intermediate and final answers to the nearest whole dollar amount.) Credit View general journal > Analysis Component: If the fair value adjustment is not recorded by Safety Development Corporation, what is the impact on the financial statements?
Safety Development Corporation had relatively large idle cash balances and invested them as follows in securities to be held as non- strategic investments: 2023 Feb. 7 Purchased 3,100 common shares of Royal Bank at $27.40, plus $500 in transaction fees. 19 Purchased 2,108 common shares of Imperial Oil at $54.00, and paid $250 in transaction fees. Apr. 1 Paid $97,182 plus $500 in transaction fees for a 8.60%, four-year, $99,000 Minco Inc. bond that pays interest quarterly beginning June 30. The market rate of interest on this date was 9.00%. Sellers Corporation plans to hold this investment for the duration of the bond's contract life. May 26 Purchased 2,900 common shares of BCE at $14.28, plus $200 in transaction fees. June 1 17 Sold 2,100 Royal Bank common shares at $27.90. Received a $0.25 per share cash dividend on the Royal Bank common shares. 30 Received interest on the Minco Inc. bond. Aug. 5 Received a $0.50 per share cash dividend on the Imperial Oil common shares. Sept. 1 Received a $0.275 per share cash dividend on the remaining Royal Bank common shares. 38 Received interest on the Minco Inc. bond.. Dec. 31 Received interest on the Minco Inc. bond. On December 31, 2023, the fair values of the investments held by Safety Development Corporation were: Royal Bank, $28.40; Imperial Oil, $52.38; and BCE, $14.40. Assume the fair value and carrying value of the Minco Inc. bond were equal. Required: 1. Prepare an amortization schedule for the Minco Inc. bond showing only 2023. (Round your intermediate and final answers to the nearest whole dollar amount. Enter all the amounts as positive values.) Apr. 1/23 June 30/23 Sept. 30/23 Dec. 31/23 Cash Interest Received. Period Interest Income Discount Amort. Unamortized Discount Carrying Value
Transcribed Image Text:Safety Development Corporation had relatively large idle cash balances and invested them as follows in securities to be held as non- strategic investments: 2023 Feb. 7 Purchased 3,100 common shares of Royal Bank at $27.40, plus $500 in transaction fees. 19 Purchased 2,108 common shares of Imperial Oil at $54.00, and paid $250 in transaction fees. Apr. 1 Paid $97,182 plus $500 in transaction fees for a 8.60%, four-year, $99,000 Minco Inc. bond that pays interest quarterly beginning June 30. The market rate of interest on this date was 9.00%. Sellers Corporation plans to hold this investment for the duration of the bond's contract life. May 26 Purchased 2,900 common shares of BCE at $14.28, plus $200 in transaction fees. June 1 17 Sold 2,100 Royal Bank common shares at $27.90. Received a $0.25 per share cash dividend on the Royal Bank common shares. 30 Received interest on the Minco Inc. bond. Aug. 5 Received a $0.50 per share cash dividend on the Imperial Oil common shares. Sept. 1 Received a $0.275 per share cash dividend on the remaining Royal Bank common shares. 38 Received interest on the Minco Inc. bond.. Dec. 31 Received interest on the Minco Inc. bond. On December 31, 2023, the fair values of the investments held by Safety Development Corporation were: Royal Bank, $28.40; Imperial Oil, $52.38; and BCE, $14.40. Assume the fair value and carrying value of the Minco Inc. bond were equal. Required: 1. Prepare an amortization schedule for the Minco Inc. bond showing only 2023. (Round your intermediate and final answers to the nearest whole dollar amount. Enter all the amounts as positive values.) Apr. 1/23 June 30/23 Sept. 30/23 Dec. 31/23 Cash Interest Received. Period Interest Income Discount Amort. Unamortized Discount Carrying Value
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