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a. On February 15, paid $130,000 cash to purchase GMIs 90-day short-term notes at par, which are dated February 15 and pay 7
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Journal Entries:

Transaction General Journal Debit Credit
a) Short-term Investments $130,000
   Cash $130,000
(To record the purchase of shor-term investments)
b) Long-term Investments (800 shares * $23) $18,400
   Cash $18,400
(To record the purchase of long-term investments)
c) Cash ($130,000 + $2,275) $132,275
   Short-term Investments $130,000
   Interest Revenue ($130,000*7/100*90 days/360 days) $2,275
(To record the receipt of cash for short-term investment along with interest)
d) Short-term Investments $39,000
   Cash $39,000
(To record the purchase of shor-term investments)
e) Cash (800 shares * $0.68 per share) $544
   Dividend Revenue $544
(To record the receipt of cash dividends on the long-term investment)
f) Cash (400 shares * $29 per share) $11,600
   Long-term Investments (400 shares * $23 per share) $9,200
   Gain on sale of long-term investments ($29 - $23 = $6 * 400) $2,400
(To record the sale of 400 shares from long-term investment)
g) Cash $585
   Interest Revenue ($39,000*6/100*3/12 months) $585
(To record the interest revenue received)
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