Answer Happy

Prepare entries to record the following non-strategic investment transactions of Arrowhead Investment Corporation. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Round your final answers to the nearest whole dollar amount.) 2020 Mar. 1 Paid $79,988 to purchase a $79,000, two-year, 9.5% bond payable of Action Corporation dated March 1. Interest is paid quarterly beginning June 1. Management intends to actively trade bond purchases. Apr. 16 Bought 2,950 'common shares of Brandon Motors at $29.50. May 2 Paid $57,968 to purchase a five-year, 7.00%, $59,eee bond payable of Collingwood Corporation. Interest is paid annually each April 30. June 1 Received a cheque from Action Corporation regarding quarterly interest. Aug. 1 Brandon Motors board of directors declared a dividend of se.75 per share to shareholders of record on August 10, payable August 15. 15 Received the Brandon Motors dividend. Sept. 1 Received a cheque from Action Corporation regarding quarterly interest. 17 Purchased 26,900 Dauphin Inc. common shares at $4.20. Oct. 20 Sold the Brandon Motors shares at $31.80. Dec. 1 Received a cheque from Action Corporation regarding quarterly interest, 1 Sold the Action Corporation bond at 101. 31 Accrued interest on the Collingwood bond. The fair value of the equity security on this date was Dauphin, $4,50. The carrying value equalled the fair value for the Collingwood bond. 2021 Apr. 30 Received a cheque from Collingwood Corporation regarding annual interest.
Journal entry worksheet 3 4 5 6 7 8 14 ***** Record the purchase of $79,000, 2-year, 9.500% bond payable to be held as an investment. Note: Enter debits before credits. Date General Journal Debit Credit Mar 01, 2020
Journal entry worksheet 3 4 5 6 7 8 14 ***** Record the purchase of $79,000, 2-year, 9.500% bond payable to be held as an investment. Note: Enter debits before credits. Date General Journal Debit Credit Mar 01, 2020
Analysis Component: If the fair value adjusting entry on December 31, 2020, were not recorded, what would the effect be on the income statement and balance sheet? Income Statement Balance Sheet No effect Overstated Understated
Based on your understanding of GAAP, would it be better or worse to omit an investment loss than investment income? O Better O Worse