90.2K

Verified Solution

Link Copied!

Monkey Mortgage Inc. engaged in the following non$-$strategic investment transactions during $2023,$ all with intent to hold to maturity:

$2023$

Jan. $1$ Purchased for $$408,841$ a $6\mathrm{.}5\%,$ $$402,000$ Jaguar Corp. bond that matures in five years when the market interest rate was $6\mathrm{.}1\%.$ There was a $$$30$ transaction fee included in the above$-$noted payment amount. Interest is paid semiannually beginning June $30,2023.$ Monkey Mortgage Inc. plans to hold this investment until maturity.

Mar. $1$ Bought $6,100$ shares of Mule Corp., paying $$32\mathrm{.}60$ per share. There was a $$30$ transaction fee included in the above$-$noted payment amount.

May $7$ Received dividends of $$1\mathrm{.}00$ per share on the Mule Corp. shares.

June $1$ Paid $$317,000$ for $21,050$ shares of Zebra common shares. There was a $$$30$ transaction fee included in the above$-$noted payment.

June $30$ Received interest on the Jaguar bond.

Aug. $1$ Sold the Mule Corp. shares for $$32\mathrm{.}85$ per share.

Dec. $31$ Received interest on the Jaguar bond.

Dec. $31$ The fair value of the Zebra shares on this date was $$15\mathrm{.}00$ per share. Assume the fair value of the bonds equalled the carrying value.

$2024$

Jan. $14$ Sold the Zebra shares for $$14\mathrm{.}80.$

Required:

$1.$ Prepare an amortization schedule for the Jaguar bond showing only $2023$ and $2024.($Enter all the amounts as positive values. Do not round intermediate calculation. Round your final answers to the nearest whole dollar amount.$)$

$2.$ Prepare the entries to record the transactions described above. $($Do not round intermediate calculations. Round your final answers to the nearest whole dollar amount.$)$

$3.$ Show how the investments would be reported on Monkey$$s December $31,2023,$ balance sheet. $($Do not round intermediate calculations. Round your final answers to the nearest whole dollar amount.$)$

Answer & Explanation Solved by verified expert

See Answer