The following information relates to the HTM debt securities investments of Kiran Company during 2016. a....

The following information relates to the HTM debt securities investments of Kiran Company during 2016.

a. January 1: The company purchased 8% bonds of Tempe Co. having a par value of $240,000 at 99 plus accrued interest. Interest is payable May 1 and November 1. Maturity date is 11/1/17.

b. May 1: Semiannual interest is received and amortization is updated.

c. July 1: 10% bonds of Flagstaff were purchased. The bonds had a par value of $75,000 and were purchased at 101 plus accrued interest. Interest dates are March 1 and September 1. Maturity date is 9/1/17.

d. September 1: Semiannual interest is received and amortization updated for the Flagstaff bonds.

e. November 1: Semiannual interest is received and amortization updated for the Tempe bonds.

f. December 31: Interest is accrued and amortization updated for both set of bonds.

Required:

a) Prepare journal entries for all dates. Present journal entries for the Tempe bonds (a, b, e, f), then journal entries for the Flagstaff bonds (c, d, f). No explanations or supporting computations are required. Use straight-line amortization. Do NOT use separate accounts for discounts and premiums; instead, net them into the Investments account. When computing amortization, round the monthly amortization amounts to the nearest cent. However, journal entry amounts can be rounded to the nearest dollar.

Expert Solution

Jan-01	Investment in Bonds	$ 2,40,800.00
	Cash		$ 2,40,800.00

May-01	Cash	$ 9,600.00
	Interest Revenue		$ 6,400.00
	Interest Advance		$ 3,200.00

	Interest Expenses	$ 267.00
	Inv in Bonds		$ 267.00

Nov-01	Cash	$ 9,600.00
	Interest Advance	$ 3,200.00
	Interest Revenue		$ 9,600.00
	Interest Advance		$ 3,200.00

	Interest Expenses	$ 400.00
	Investment in Bonds		$ 400.00

Dec-31	Interest Advance	$ 3,200.00
	Interest Revenue		$ 3,200.00

	Interest Expenses	$ 133.00
	Investment in Bonds		$ 133.00

Flagstaff Bonds

Jul-01	Investment in Bonds	$ 78,250.00
	Cash		$ 78,250.00

Sep-01	Cash	$ 3,750.00
	Interest Advance		$ 2,500.00
	Interest Revenue		$ 1,250.00

	Interest Expenses	$ 1,083.00
	Investment in Bonds		$ 1,083.00

Dec-31	Interest Advance	$ 2,500.00
	Interest Revenue		$ 2,500.00

	Interest Expenses	$ 2,167.00
	Investment in Bonds		$ 2,167.00

ekkarill92 answered 2 years ago

The following information relates to the HTM debt securities investments of Kiran Company during 2018: a. ...

The following information relates to the HTM debt securities investments of Kiran Company during 2018: a. February 1: The company purchased 10% bonds of Tempe Co. having a par value of $150,000 at 97 plus accrued interest. Interest is payable on March 1 and September 1. Maturity date is 9/1/19 b. March 1: Semiannual interest is received and amortization is updated. c. June 1: 9% bonds of Flagstaff were purchased. The bonds had a par value of $80,000 and were...

2. The following information relates to the HTM debt securities investments of Kiran Company during 2018:...

2. The following information relates to the HTM debt securities investments of Kiran Company during 2018: a. February 1: The company purchased 10% bonds of Tempe Co. having a par value of $150,000 at 102 plus accrued interest. Interest is payable on March 1 and September 1. Maturity date is 12/31/19 b. March 1: Semiannual interest is received and amortization is updated. c. June 1: 9% bonds of Flagstaff were purchased. The bonds had a par value of $80,000 and...

The following information relates to the debt securities investments of Larkspur Company. 1. On February 1,...

The following information relates to the debt securities investments of Larkspur Company. 1. On February 1, the company purchased 10% bonds of Gibbons Co. having a par value of $309,600 at 100 plus accrued interest. Interest is payable April 1 and October 1. 2. On April 1, semiannual interest is received. 3. On July 1, 8% bonds of Sampson, Inc. were purchased. These bonds with a par value of $180,000 were purchased at 100 plus accrued interest. Interest dates are...

The following information relates to the debt securities investments of Kingbird Company. 1. On February 1,...

The following information relates to the debt securities investments of Kingbird Company. 1. On February 1, the company purchased 11% bonds of Gibbons Co. having a par value of $310,800 at 100 plus accrued interest. Interest is payable April 1 and October 1. 2. On April 1, semiannual interest is received. 3. On July 1, 8% bonds of Sampson, Inc. were purchased. These bonds with a par value of $192,000 were purchased at 100 plus accrued interest. Interest dates are...

Problem 17-7 The following information relates to the debt securities investments of Carla Company. 1. On...

Problem 17-7 The following information relates to the debt securities investments of Carla Company. 1. On February 1, the company purchased 10% bonds of Gibbons Co. having a par value of $322,800 at 100 plus accrued interest. Interest is payable April 1 and October 1. 2. On April 1, semiannual interest is received. 3. On July 1, 9% bonds of Sampson, Inc. were purchased. These bonds with a par value of $201,600 were purchased at 100 plus accrued interest. Interest...

Problem 17-7 The following information relates to the debt securities investments of Ivanhoe Company. 1. On...

Problem 17-7 The following information relates to the debt securities investments of Ivanhoe Company. 1. On February 1, the company purchased 10% bonds of Gibbons Co. having a par value of $313,200 at 100 plus accrued interest. Interest is payable April 1 and October 1. 2. On April 1, semiannual interest is received. 3. On July 1, 9% bonds of Sampson, Inc. were purchased. These bonds with a par value of $216,000 were purchased at 100 plus accrued interest. Interest...

The following information relates to the debt investments of Sarasota Inc. during a recent year: 1....

The following information relates to the debt investments of Sarasota Inc. during a recent year: 1. On February 1, the company purchased Gibbons Corp. 10% bonds with a face value of $324,000 at 100 plus accrued interest. Interest is payable on April 1 and October 1. 2. On April 1, semi-annual interest was received on the Gibbons bonds. 3. On June 15, Sampson Inc. 9% bonds were purchased. The $216,000 par-value bonds were purchased at 100 plus accrued interest. Interest...

The following information relates to the debt investments to Mayor Company on 2020. 1. On January...

The following information relates to the debt investments to Mayor Company on 2020. 1. On January 1, Purchased 100, $1,000 Mirror Corp. 10% bonds for $100,000 (at 100). Interest is payable on July 1 and January 1. 2. On April 1, Purchased 80, $1,000 Bondi Inc 9% bonds for $80,000 (at 100). Interest is payable on April 1 and October 1. 3. On July 1, semiannual interest is received. 4. On October 1, semiannual interest is received. 5. On October...

PROBLEM 1 The following information relates to the debt investments to Mayor Company on 2020. On...

PROBLEM 1 The following information relates to the debt investments to Mayor Company on 2020. On January 1, Purchased 100, $1,000 Mirror Corp. 10% bonds for $100,000 (at 100). Interest is payable on July 1 and January 1. On April 1, Purchased 80, $1,000 Bondi Inc 9% bonds for $80,000 (at 100). Interest is payable on April 1 and October 1. On July 1, semiannual interest is received. On October 1, semiannual interest is received. On October 1, Sold 30...

1.The following information relates to the debt investments of Black Elk Petroleum Company: On February 1,...

1.The following information relates to the debt investments of Black Elk Petroleum Company: On February 1, the company purchased 10% bonds of Gerber Co. having a par value of $300,000 at 100 plus accrued interest. Interest is payable April 1 and October 1. On April 1, semiannual interest is received. On July 1, 9% bonds of Target, Inc. were purchased. The bonds have a par value of $200,000 and were purchased at 100 plus accrued interest. Interest dates are June...

Question