Bruce Company purchased $2,000,000 of Clarence, Incorporated, 4.0% bonds at par on July 1, 2024, with interest paid semi-annually. Bruce determined that it should account for the bonds as an available-for-sale investment. At December 31, 2024, the Clarence bonds had a fair value of $2,300,000. Bruce sold the Clarence bonds on July 1, 2025 for $1,950,000.                     Face amount of bond         $2,000,000          Stated (and market) rate         4.0%         December 31, 2024 fair value of bonds         $2,300,000          Selling price of bonds, July 1, 2025         $1,950,000                                                                                          Complete the following tables to show the effect of the Clarence bonds on Bruce’s net income, other comprehensive income, and comprehensive income for 2024, 2025, and cumulatively over the two-year period.  FORMULAS FOR LOSSES MUST RETURN NEGATIVE VALUES.                             2024 2025 Total       Interest revenue $40,000  $40,000  $80,000        Gain (loss) on investment (Net income) 0  (50,000) (50,000)       Gain (loss) on investment (Unrealized) 300,000  (350,000) (50,000)       Reclassification adjustment (OCI) 300,000  300,000  600,000                                    2024 2025 Total       Net income $40,000  ($10,000) $30,000        Other Comprehensive income 300,000  (350,000) (50,000)       Comprehensive income $340,000  ($360,000) ($20,000)

On January 1, 2026, Baker Company purchased, as an investment, 5% bonds, having a maturity value of $150,000, for $138,400. The bonds provide the bondholders with a 7% yield. They are dated January 1, 2026, and mature January 1, 2036, with interest receivable June 30 and December 31 of each year. The securities are classified as available-for-sale. January 1, 2026 June 30, 2026 December 31, 2026 June 30, 2027 December 31, 2027 June 30, 2028 December 31, 2028 Schedule of Interest Revenue and Bond Amortization Amortization Cash Received (2.5%) Interest Revenue (3.5%) 3,750 3,750 3,750 3,750 3,750 3,750 4,844 4,882 4,922 4,963 5,005 5,049 The fair value of the bonds at December 31 of each year-end is as follows. 2026 145,000 2027 148,000 2028 152,000 1,094 1,132 1,172 1,213 1,255 1,299 Carrying Value 138,400 139,494 140,626 141,798 143,011 144,266 145,565 a) Prepare the journal entry at the date of the investment purchase. b) Prepare the journal entries to record the interest received on…

On December 31, 2015, Martin Corp invested in Marlin’s 5-year, $200,000 bond with a 5% interest rate for $191,575. The bond pays semiannual interest on June 30th and December 31st.  The fair values of the bonds at the end of 2016~2018 are $194,500, $194,200, and $195,750.  Martin sold its investment in Marlin’s bond on July 1, 2019 at 98 ½ (i.e. selling price is = 98.5% of the face value).  Assuming the bonds are classified as Trading investment, prepare the journal entries on aforementioned dates.

Sheridan Company purchased $1250000 of 8 %, 5-year bonds from Pina, Inc. on January 1, 2025, with interest payable on July 1 and January 1. The bonds sold for $1299896 at an effective interest rate of 7%. Using the effective interest method, Sheridan decreased the Available for - Sale Debt Securities account for the Pina bonds on July 1, 2025 and December 31, 2025 by the amortized premiums of $4748 and $4892, respectively. At December 31, 2025, the fair value of the Pina bonds was $1317000. What should Sheridan report as other comprehensive income and as a separate component of stockholders' equity (assuming that this is Sheridan's first investment in available - for - sale debt securities)? Select answer from the options below $0 $26744 $9640 $17104