On January 1, Jewel Company buys $213,000 of Marcelo Corp. 12%, 36-month notes. Interest is paid on the last day of each month. The notes are classified as available-for-sale securities. This is the company's first and only investment in available-for-sale securities. On December 31, the notes have a fair value of $218,300. The journal entry on January 1 to record the investment is:
A. Debit Debt Investments - Trading, $213,000; Credit Cash, $213,000.
B. Debit Debt Investments - AFS, $213,000; Credit Cash, $213,000.
C. Debit Debt Investments - AFS, $218,300; Credit Cash, $218,300.
D. Debit Debt Investments - HTM, $218,300; Credit Cash, $218,300.
E. Debit Debt Investments - HTM, $213,000; Credit Cash, $213,000.
Answer: B
You might also like to view...
List the major types of limited-service wholesalers and identify the functions of each
What will be an ideal response?
All of the following are true of the gross profit ratio except:
a. gross profit is a function of the markup percentage. b. the gross profit ratio is calculated by dividing gross margin by net sales. c. a revenue-related fraud scheme that overstates sales will result in an increase in this ratio. d. the gross profit ratio will increase if cost of goods sold is overstated.
The common law requirement that the seller make a tender of delivery that conforms in all respects to the contract requirements was retained by drafters of the UCC, although the Code includes sections that limit the rule's effect
a. True b. False Indicate whether the statement is true or false
Which of the following is equivalent to a short position in a European put option?
A. A short position in a cash-or-nothing put option plus a long position in an asset-or-nothing put option B. A long position in an asset-or-nothing put option plus a long position in a cash-or-nothing put option C. A long position in an asset-or-nothing call option plus a long position in a cash-or-nothing call option D. A long position in an asset-or-nothing call option plus a short position in a cash-or-nothing call option