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Connect HomeStudentsx 42 Homework Chapter x https://newconnect.mheducation.com/flow/connect.html xWeek 4 Homeworkx work Chapter 12 Help Save & Exit Subm Saved Check my worl Rantzow-Lear Company buys and sells debt securities expecting to earn profits on short-term differences in price. The company's fiscal year ends on December 31. The following selected transactions relating to Rantzow-Lear's trading account occurred during December 2018 and the first week of 2019 2018 Dec. 17 Purchased 155 Grocers' Supply Corporation bonds for $542,50e 28 Received interest of $4,200 from the Grocers' Supply Corporation bonds. 31 Recorded any necessary adjusting entry relating to the Grocers' Supply Corporation bonds. The market price of the bonds were $4,eee per bond. 2019 Jan. 5 Sold the Grocers' Supply Corporation bonds for $684,5e0 Required: 1. Prepare the appropriate journal entry or entries for each transaction. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) es View transaction list View journal entry worksheet No Date General Journal Debit Credit December 17, Investment in Grocers Supnlv bonds 542.500 rev

Explanation / Answer

Answer

Date

Debit

Credit

17-Dec

Investment in Grocers Supply Bonds

           542,500

Cash

           542,500

28-Dec

Cash

                4,200

Investment Revenue

                4,200

31-Dec

Fair Value Adjustment [(155 Bonds * $4,000 per bond) - 542,500]

77500

Net Unrealized Holding Gain and Losses

77500

2019

5-Jan

Cash

           604,500

Investment in Grocers Supply Bonds

           542,500

Gain on Investments (Bal.)

             62,000

31-Dec

Net Unrealized Holding Gain and Losses

77500

Fair Value Adjustment

77500

Date

Debit

Credit

17-Dec

Investment in Grocers Supply Bonds

           542,500

Cash

           542,500

28-Dec

Cash

                4,200

Investment Revenue

                4,200

31-Dec

Fair Value Adjustment [(155 Bonds * $4,000 per bond) - 542,500]

77500

Net Unrealized Holding Gain and Losses

77500

2019

5-Jan

Cash

           604,500

Investment in Grocers Supply Bonds

           542,500

Gain on Investments (Bal.)

             62,000

31-Dec

Net Unrealized Holding Gain and Losses

77500

Fair Value Adjustment

77500

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