Chapter 12, Problem 12.15E

a)

To determine

Investment: The act of allocating money to buy a monetary asset, in order to generate wealth in the future is referred to as investment.

Debt investments: The investments in debt securities are referred to as debt investments.

Debt securities: The financial instruments which are bought by investors, or corporations, or mutual funds, are referred to as debt securities. The companies issue debt securities to raise capital for the purposes of purchasing assets, or paying debts.

Journal entry: Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically.

Debit and credit rules:

• Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts.
• Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.

To journalize: The receipt of semiannual interest on December 31, 2016 in the books of Corporation W.

b)

To determine

To indicate: The amount of investment value as on December 31, 2016 in the books of Corporation W.