Problem 15-1A (40 minutes)
Part 1
Aug. 2 Debt Investments-Trading $10,000
Cash
Purchased Verizon bonds at $10,000
Sept. 7 Debt Investments-Trading $35,000
Cash
Purchased Apple bonds at $35,000
Oct. 12 Debt Investments-Trading $20,000
Cash $20,000
Oct. 21 Cash $2,100
Gain on Sale of Debt Investments
Debt Investments-Trading $10,000
Purchased Mastercard bonds at $20,000
Record sale of Verizon trading securities with a
$2,000 cost in return for $2,100 cash
Oct. 23 Cash $15,400
Gain on Sale of Debt Investments
Debt Investments-Trading
Record sale of Apple trading securities with a
$15,000 cost in return for $15,400 cash
Nov. 1 Debt Investments-Trading $40,000
Cash
Purchased Walmart bonds at $40,000
Dec. 10 Cash $18,000
Loss on Sale of Debt Investments $2,000
Debt Investments-Trading
Record sale of Mastercard trading securities with a $20,000 cost in return for $18,000 cash
Problem 15-1A (Continued)
Part 2
Portfolio of Trading Securities
| Cost | Fair Value | Unrealized Gain (Loss) |
| Verizon bonds | $2,000 | $8,000 | $8,500 |
| Apple bonds | $15,000 | $20,000 | $22,000 |
| Walmart bonds | $40,000 | $39,000 | ($1,000) |
| Total | $68,000 | $69,500 | $1,500 |
Dec. 10 Nov. 1 Oct. 23 Oct. 21 Cash Part 1 Cash Cash Cash Cash Cash Cash Problem 15-1A (40 minutes) $20,000 cost in return for $18,000 cash Purchased Walmart bonds at $40,000 $15,000 cost in return for $15,400 cash $2,000 cost in return for $2,100 cash Oct. 12 Debt Investments-Trading Purchased Apple bonds at $35,000 Sept. 7 Debt Investments-Trading Debt Investments-Trading Record sale of Apple trading securities with a Purchased Mastercard bonds at $20,000 Purchased Verizon bonds at $10,000 Aug. 2 Debt Investments-Trading Record sale of Verizon trading securities with a $2,000 18,000 40,000 20,000 40,000 15,000 400 2,000 100 20,000 35,000 10,000
Dec. 31 Part 3 Walmart bonds Part 2 Apple bonds ($35,000 - $15,000) Verizon bonds ($10,000 - $2,000) Portfolio of Trading Securities Problem 15-1A (Continued) Unrealized Gain Income Fair Value Adjustment Trading $68,000 $40,000 $20,000 $8,000 $1,500 $69,500 $39,000 $22,000 $8,500 Cost Fair Value Gain (Loss) $1,500 $1,500 Unrealized