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MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
Professor
Phoniex University
Oct-2001 - Nov-2016
(Available-for-Sale Debt Investments) Presented below is information taken from a bond investment amortization schedule with related fair values provided. These bonds are classified as available-for-sale.
| Â |
12/31/12 |
12/31/13 |
12/31/14 |
|
Amortized cost |
$491,150 |
$519,442 |
$550,000 |
|
Fair value |
$497,000 |
$509,000 |
$550,000 |
Instructions
(a) Indicate whether the bonds were purchased at a discount or at a premium.
(b) Prepare the adjusting entry to record the bonds at fair value at December 31, 2012. The Fair Value Adjustment account has a debit balance of $1,000 prior to adjustment.
(c) Prepare the adjusting entry to record the bonds at fair value at December 31, 2013.
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