Question

Company A makes the following investments on July 1, 2014 (Campany A lacks of significant influence)...

Company A makes the following investments on July 1, 2014 (Campany A lacks of significant influence)

                                Initial value         Discount              Value on Dec 31, 14         Dividends or interest pmt            Market Rate                Intentions           Reporting Category

a.            Apple stock        10,000 n/a        9,000    None    n/a        Sell in 8 days      

b.            Google stock      25,000 n/a        22,000 500        n/a        Sell in 2 years    

c.             Disney bonds     15,000 2,400    18,000 600        10%        Hold until matures          

d.            GM bonds           40,000 1,000    35,000 1,720    9%          Sell in 5 years    

                note: bonds pay interest semi-annually starting on Dec 31                                                                           

1. Initial entries                                 Investment        Cash Discount

a.   

b.                                                                                                                           

c.                                                                                                                            

d.                                                                                                                                                                                           

2. Investment income                                    Cash      Discount              Investment Revenue                                    

a.                                                                                                                           

b.                                                                                                                           

c.                                                                                                                            

d.                                                                                           

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