In this simulation, you are asked to address questions related to investments. Prepare responses to allparts. KWW_Professional

In this simulation, you are asked to address questions related to investments. Prepare responses to allparts.

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KWW_Professional Simulation Time Remaining 3 hours 20 minutes Investments Unspit Split Horiz Spit Vertical Spreadsheet Calculator Exit Situation Journal Entries Measurement Explanation Resources Directions Powerpuff Corp. carries an account in its general ledger called investments, which contained the following debits for investment purchases and no credits. Feb. 1, 2012 Blossom Company common stock, $100 par, 200 shares $ 37,400 U.S. Government bonds, 11%, due April 1, 2012, interest payable April 1 and October 1, 100 bonds of $1,000 par each Buttercup Company 12% bonds, par $50,000, dated March 1, 2012, purchased at par plus accrued interest, interest payable annually on March 1, due March 1, 2032 April 1 100,000 July 1 52,000 Measurement Explanation Resources SituationJournal Entries Directions (a) Assuming that all the investments are classified as available-for-sale, prepare the journal entries necessary to classify the amounts into the proper accounts. (b) Prepare the entry to record the accrued interest on December 31, 2012. Situation Journal Entries Measurement Explanation Resources Directions The fair values of the investments on December 31, 2012, were: $ 33,800 (1% interest) 124,700 58,600 Blossom Company common stock U.S. Government bonds Buttercup Company bonds Use a computer spreadsheet to prepare a schedule indicating any fair value adjustment needed at December 31, 2012. SituationJournal Entries Measurement Explanation Resources Directions Now assume Powerpuff's investment in Blossom Company represents 30% of Blossom's shares. In 2012, Blossom declared and paid dividends of $9,000 (on September 30) and reported net income of $30,000. Prepare a brief memorandum explaining how the accounting for the Blossom investment will change, and discuss the impact on the financial statements of Powerpuff Corp.