ACC 304 Course Great Wisdom / tutorialrank.com ACC 304 Course Great Wisdom / tutorialrank.com | Page 265

December 31, 2015

46,660

45,060

December 31, 2016

38,850

40,980

(a) Prepare the journal entry at December 31 (Fallen’s year-end)
for 2014, 2015, and 2016, to record the fair value option for
these notes. (If no entry is required, select "No Entry" for the
account titles and enter 0 for the amounts.Credit account titles
are automatically indented when amount is entered. Do not
indent manually.)

(b) At what amount will the note be reported on Fallen’s 2015
balance sheet?

Note to be reported on Fallen’s 2015 balance sheet

$

(c) What is the effect of recording the fair value option on these
notes on Fallen’s 2016 income?