Question

Check my work Amalgamated General Corporation is a consulting firm that also offers financial services through its credit division ompany buys and sells securities. The following selected transactions relate to Amalgamated's investment activities during the last quarter of 2018 and the first month of 2019. Th held by Amalgamated at October 1 were $30 million of 10% bonds of Kansas Abstractors, Inc., purchased on May 1 at face value and held in Amalgamated's trading portfolio. The company's fiscal year ends on December 31 e only securities 2018 Oct. 18 Purchased 2 million preferred shares of Millwork Ventures Company for $58 million. 31 Received semiannual interest of $1.5 million from the Kansas Abstractors bonds. Nov. 1 Purchased 10% bonds of Holistic Entertainment Enterprises at their S18 million face value, to be held until they mature in 2025. Semiannual interest is payable April 30 and October 31. 1 Sold the Kansas Abstractors bonds for $28 million because rising interest rates are expected to cause their fair value to continue to fall. No unrealized gains and losses had been recorded on these bonds previously Plastics Corporation at their $60 million face value, to be held until Dec. 1 Purchased 12% bonds of Household they mature in 2028. Semiannual interest is payable May 31 and November 30 20 Purchased U. S. Treasury bonds for $5.6 million as trading securities, hoping to earn profits on short term differences in prices. dividends or gains if prevailing market conditions encourage sale. Sold the Treasury bonds for s5.7 niion. 21 Purchased 4 million common shares of NXS Corporation for $44 million, planning to earn profits from 29 Received cash dividends of $3 million from the M21Work Ventures Company preferred shares 31 Recorded any necessary adjusting entry(sl and closing entries relating to the investments. The market price of the Millwork Ventures Company preferred stock was $27.50 per share and 511,50 per share for NXS Corporation common, The fairivalues of the bond investments iere $58.7 million for Hou Corporation and $16.7 nillion for Hollstic Entertainnent Enterprises

Answer 1

Journal entries in the books of amalagamated general corporation

Date	Account Name	Debit ($ In Millions)	Credit ($ In Millions)
18-oct -2018	Mill work company invest ment A/c                                                Dr                           Cr   Cash / Bank A/c (Being 2 million shares of million work company purchased for $58 Million)	$58	$58
31-oct-2018	Cash /Bank A/C                                  Dr                     Cr Interest Income Received A/c (Being Semi annual interest Received from the Kansas Abstractor bonds)	$1.5	$1.5
01-Nov-2018	10% Bonds of Holistic entertainment Investment A/c                                          Dr                Cr Cash /Bank A/c (Being 10% Bonds Holistic Entertainment investments were purchased for $ 18 Million)	$18	$18
01-Nov-2018	Cash /Bank A/c                                        Dr Loss on Sale of Investments A/c              Dr              Cr 10% Kansas abstractor Inc. bonds                Investment (Being 10% Kansas abstractor Bonds were sold for a Loss of $2	$28       $2	$30
01-Nov -2018	Profit & Loss A/c                                      Dr                     Cr Loss on Sale of Investments A/c (Being Loss on sale of Investments transferred to Profit & Loss A/c)	$2	$2
1-Dec-2018	12% Bonds of House hold Plastic Investment A/c                                                           Dr                     Cr Cash /Bank A/c (Being12% bonds of house hold corporation purchased at face value of 60Millions)	$60	$60
20-Dec-2018	US Treasury Bonds Investment A/c             Dr              Cr Cash /Bank (Being U S Treasury Bonds purchased for $5.6 as a trading security)	$5.6	$5.6
21-Dec -2018	NXS Corporation Investments A/c               Dr                Cr Cash/Bank (Being 4 Million Common shares of NXS Corporation purchased for $44 Millions)	$44	$44
23-Dec-2018	Cash/Bank A/c                                             Dr                 Cr US Treasury Bonds Investment A/c                 Cr Profit On sale of Investment             (Being US Treasury Bonds Sold at a Profit of $0.1)	$5.7	$5.6 0.1
23-Dec-2018	Profit On sale of Investment     A/c                 Dr       Cr Profit & Loss A/c (Being Profit On sale of Investment Tranfer to P&L)	$0.1	$0.1
29-Dec-2018	Cash/Bank A/c                                             Dr            Cr Dividend Income Received A/c (Being Dividend Income Received from Mill work Venture Company)	$3	$3
	Long term Investment Usually carried at Cost when there is decline other than temporary in the value of Investment, the Carrying amount is reduced to recognise the Decline. Carrying amount for current investment is the lower of Cost or fair value whichever is lower The closing entries are as follows.
31-Dec-2018	Profit & Loss A/c                                           Dr    Cr   Mill work company invest ment A/c    (Being Long term investments are decined and loss transfer to Profit & Loss A/c)	$30.5	$30.5
31-Dec-2018	Profit & Loss A/c                                           Dr    Cr NXS Corporation Investments A/c      (Being Long term investments are decined and loss transfer to Profit & Loss A/c)	$32.5	$32.5
31-Dec-2018	Profit & Loss A/c                                           Dr    Cr12% Bonds of House hold Plastic Investment A/c                                                                 (Being Long term investments are decined and loss transfer to Profit & Loss A/c)	$1.3	$1.3
31-Dec-2018	Profit & Loss A/c                                           Dr    Cr Holistic Entertainment                                                                 (Being Long term investments are decined and loss transfer to Profit & Loss A/c)	$1.3