Trainor Inc

question 1

Essay

Trainor Inc., a public company, had the following transactions pertaining to debt investments held as trading investments:
Jan 1 Purchased 60, 8%, $1,000 Terry Corp. bonds for $60,000. Interest is payable semi-annually on July 1 and January 1. On December 31 the bonds were trading at 101.
Jul 1 Received semi-annual interest on Terry Corp. bonds.
1 Sold 30 Terry Corp. bonds for $32,000.
Instructions
a. Journalize the transactions.
b. Prepare the required adjusting journal entries at December 31.

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Definitions:

Production Department

A specific division within a company focused on the manufacture of goods and products.

Variance Reports

Documents that compare actual performance to planned or budgeted performance, highlighting differences or "variances."

Top Management

Refers to the highest level in the management hierarchy, responsible for the overall strategy and direction of an organization.

Standard Cost

A predetermined cost of manufacturing, which is often used in budgeting and variance analysis.