Eclipse Inc. is an athletic footware company that began operations on January 1, 2010. The following transactions relate to debt investments acquired by Eclipse Inc., which has a fiscal year ending on December 31:

2010

Mar. 1. Purchased $80,000 of Noble Co. 6%, 10-year bonds at face value plus accrued interest of $400. The bond is classified as an available-for-sale investment.

The bonds pay interest semiannually on February 1 and August 1.

Apr. 16. Purchased $105,000 of Mason City 4%, 15-year bonds at face value plus accrued interest of $175. The bond is classified as an available-for-sale investment. The bonds pay interest semiannually on April 1 and October 1.

Aug. 1. Received semiannual interest on the Noble Co. bonds.

Sept. 1. Sold $30,000 of Noble Co. bonds at 99 plus accrued interest of $150.

Oct. 1. Received semiannual interest on Mason City bonds.

Dec. 31. Accrued $1,250 interest on Noble Co. bonds.

31. Accrued $1,050 interest on Mason City bonds.

31. The available-for-sale bond portfolio was adjusted to fair values of 98 and 99 for Mason City and Noble Co. bonds, respectively.

2011

Feb. 1. Received semiannual interest on the Noble Co. bonds.

Apr. 1. Received semiannual interest on the Mason City bonds.

(Assume that there are no more purchases or sales of bonds during 2011. Also assume all subsequent interest transactions for 2011 have been recorded properly.)

Dec. 31. The available-for-sale bond portfolio was adjusted to fair values of 100 and 102 for Mason City and Noble Co. bonds, respectively.

Instructions

1. Journalize the entries to record these transactions.

2. Prepare the investment-related current asset and stockholders’ equity balance sheet disclosures for Eclipse Inc. on December 31, 2011, assuming the Retained Earnings balance on December 31, 2011, is $490,000.