Fuzzy Monkey Technologies, Inc., purchased as a long - term investment $ 2 5 0 million of
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Question:
Fuzzy Monkey Technologies, Inc., purchased as a longterm investment $ million of bonds, dated January on January Management intends to have the investment available for sale when circumstances warrant. For bonds of similar risk and maturity the market yield was The price paid for the bonds was $ million. Interest is received semiannually on June and December Due to changing market conditions, the fair value of the bonds at December was $ million.
Required:
to Prepare the relevant journal entries on the respective dates record the interest at the effective rate
a At what amount will Fuzzy Monkey report its investment in the December balance sheet?
b Prepare the entry necessary to achieve this reporting objective.
How would Fuzzy Monkey's statement of cash flows be affected by this investment? If more than one approach is possible, indicate the one that is most likely.
Related Book For
Intermediate Accounting
ISBN: 978-1260481952
10th edition
Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas
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