Question: ffampt corporation is a confectionery wholesaler that frequently buys and...
is a confectionery wholesaler that frequently buys and sells
securities to meet various investment objectives. The following
selected transactions relate to FF&T’s investment activities
during the last two months of 2018. At November 1, FF&T held
$48 million of 20-year, 10% bonds of Convenience, Inc., purchased
May 1, 2018, at face value. Management has the positive intent and
ability to hold the bonds until maturity. FF&T’s fiscal year
ends on December 31.
|Nov.||1||Received semiannual interest of $2.4 million from the Convenience, Inc., bonds.|
|Dec.||1||Purchased 12% bonds of Facsimile Enterprises at their $30 million face value, to be held until they mature in 2024. Semiannual interest is payable May 31 and November 30.|
|31||Purchased U.S. Treasury bills to be held until they mature in two months for $8.9 million.|
|31||Recorded any necessary adjusting entry(s) relating to the investments.|
The fair values of the investments at December 31 were:
|Facsimile Enterprises bonds||30.9||million|
|U.S. Treasury bills||8.9||million|