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Question: 8 trading securities on july 1 2018 wolfpack corporation purchased...

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(#8) Trading Securities

On July 1, 2018, Wolfpack Corporation purchased securities which it intends to buy and sell frequently. These securities consisted of (a) Todd Corporation 10%, 5-year bonds with a face value of $20,000 which were purchased for $18,500 and (b) 400 shares of Cornett Company common stock which were purchased at $40 per share. Assume that on December 31, 2018, Wolfpack received interest on the Todd Corporation bonds as well as a $2 dividend per share interest on the Cornett Company stock.

Required:

Prepare the December 31 journal entries to record the receipt of the interest and the receipt of the dividends.
CHART OF ACCOUNTS
Wolfpack Corporation
General Ledger
ASSETS
111 Cash
113 Investment in Trading Securities
121 Accounts Receivable
141 Inventory
152 Prepaid Insurance
181 Equipment
189 Accumulated Depreciation
191 Investment in Held-to-Maturity Debt Securities
LIABILITIES
211 Accounts Payable
231 Salaries Payable
250 Unearned Revenue
261 Income Taxes Payable
EQUITY
311 Common Stock
331 Retained Earnings
REVENUE
411 Sales Revenue
431 Interest Income
432 Dividend Income
EXPENSES
500 Cost of Goods Sold
511 Insurance Expense
512 Utilities Expense
521 Salaries Expense
532 Bad Debt Expense
540 Interest Expense
541 Depreciation Expense
559 Miscellaneous Expenses
910 Income Tax Expense

Prepare the December 31 journal entries to record the receipt of the interest and the receipt of the dividends. Additional Instruction

PAGE 1

GENERAL JOURNAL

DATE ACCOUNT TITLE POST. REF. DEBIT CREDIT

1

2

3

4

5

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