Kirkland Company had no trading debt securities prior to this year. It had the following...
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Kirkland Company had no trading debt securities prior to this year. It had the following transactions this year involving trading debt securities.
Aug.
2
Purchased Verizon bonds for $12,000.
Sept.
7
Purchased Apple bonds for $37,000.
12
Purchased Mastercard bonds for $22,000.
Oct.
21
Sold some of its Verizon bonds that had cost $2,100 for $2,200 cash.
23
Sold some of its Apple bonds that had cost $17,000 for $17,400 cash.
Nov.
1
Purchased Walmart bonds for $42,000.
Dec.
10
Sold all of its Mastercard bonds for $20,000 cash.
Required1. Prepare journal entries to record these transactions. 2. Prepare a table to compare the year-end cost and fair values of its trading debt securities. Year-end fair values: Verizon, $10,500; Apple, $23,000; and Walmart, $40,000. 3. Prepare the adjusting entry to record the year-end fair value adjustment for the portfolio of trading debt securities.
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