Question
In: Accounting
On January 1, 2020, Flounder Company purchased 11% bonds, having a maturity value of $320,000 for...
On January 1, 2020, Flounder Company purchased 11% bonds, having
a maturity value of $320,000 for $344,893.28. The bonds provide the
bondholders with a 9% yield. They are dated January 1, 2020, and
mature January 1, 2025, with interest received on January 1 of each
year. Flounder Company uses the effective-interest method to
allocate unamortized discount or premium. The bonds are classified
as available-for-sale category. The fair value of the bonds at
December 31 of each year-end is as follows.
|
2020 |
$342,600 |
2023 |
$330,400 | |||
|---|---|---|---|---|---|---|
|
2021 |
$329,200 |
2024 |
$320,000 | |||
|
2022 |
$328,300 |
| (a) | Prepare the journal entry at the date of the bond purchase. | |
|---|---|---|
| (b) | Prepare the journal entries to record the interest revenue and recognition of fair value for 2020. | |
| (c) | Prepare the journal entry to record the recognition of fair value for 2021. |
(Round answers to 2 decimal places, e.g. 2,525.25.
Credit account titles are automatically indented when amount is
entered. Do not indent manually. If no entry is required, select
"No Entry" for the account titles and enter 0 for the
amounts.)
Solutions
ekkarill92 answered 2 years agoRelated Solutions
On January 1, 2020, Sheridan Company purchased 11% bonds, having a maturity value of $301,000 for...
On January 1, 2020, Sheridan Company purchased 11% bonds, having
a maturity value of $301,000 for $324,415.24. The bonds provide the
bondholders with a 9% yield. They are dated January 1, 2020, and
mature January 1, 2025, with interest received on January 1 of each
year. Sheridan Company uses the effective-interest method to
allocate unamortized discount or premium. The bonds are classified
as available-for-sale category. The fair value of the bonds at
December 31 of each year-end is as follows....
On January 1, 2020, Oriole Company purchased 11% bonds, having a maturity value of $328,000 for...
On January 1, 2020, Oriole Company purchased 11% bonds, having a
maturity value of $328,000 for $353,515.61. The bonds provide the
bondholders with a 9% yield. They are dated January 1, 2020, and
mature January 1, 2025, with interest received on January 1 of each
year. Oriole Company uses the effective-interest method to allocate
unamortized discount or premium. The bonds are classified as
available-for-sale category. The fair value of the bonds at
December 31 of each year-end is as follows....
On January 1, 2020, Sheffield Company purchased 11% bonds, having a maturity value of $289,000 for...
On January 1, 2020, Sheffield Company purchased 11% bonds,
having a maturity value of $289,000 for $311,481.74. The bonds
provide the bondholders with a 9% yield. They are dated January 1,
2020, and mature January 1, 2025, with interest received on January
1 of each year. Sheffield Company uses the effective-interest
method to allocate unamortized discount or premium. The bonds are
classified as available-for-sale category. The fair value of the
bonds at December 31 of each year-end is as follows....
On January 1, 2017, Pharoah Company purchased 12% bonds, having a maturity value of $320,000, for...
On January 1, 2017, Pharoah Company purchased 12% bonds, having
a maturity value of $320,000, for $344,260.74. The bonds provide
the bondholders with a 10% yield. They are dated January 1, 2017,
and mature January 1, 2022, with interest received on January 1 of
each year. Pharoah Company uses the effective-interest method to
allocate unamortized discount or premium. The bonds are classified
as available-for-sale category. The fair value of the bonds at
December 31 of each year-end is as follows....
On January 1, 2017, Indigo Company purchased 12% bonds, having a maturity value of $320,000, for...
On January 1, 2017, Indigo Company purchased 12% bonds, having a
maturity value of $320,000, for $344,260.74. The bonds provide the
bondholders with a 10% yield. They are dated January 1, 2017, and
mature January 1, 2022, with interest received on January 1 of each
year. Indigo Company uses the effective-interest method to allocate
unamortized discount or premium. The bonds are classified as
available-for-sale category. The fair value of the bonds at
December 31 of each year-end is as follows....
On January 1, 2020, Pearl Company sold 11% bonds having a maturity value of $600,000 for...
On January 1, 2020, Pearl Company sold 11% bonds having a
maturity value of $600,000 for $622,744, which provides the
bondholders with a 10% yield. The bonds are dated January 1, 2020,
and mature January 1, 2025, with interest payable December 31 of
each year. Pearl Company allocates interest and unamortized
discount or premium on the effective-interest basis.
Prepare a schedule of interest expense and bond amortization for
2020–2022. (Round answer to 0 decimal places, e.g.
38,548.)
Prepare the journal...
On January 1, 2017, Grouper Company purchased 11% bonds, having a maturity value of $313,000, for...
On January 1, 2017, Grouper Company purchased 11% bonds, having
a maturity value of $313,000, for $337,348.74. The bonds provide
the bondholders with a 9% yield. They are dated January 1, 2017,
and mature January 1, 2022, with interest received on January 1 of
each year. Grouper Company uses the effective-interest method to
allocate unamortized discount or premium. The bonds are classified
as available-for-sale category. The fair value of the bonds at
December 31 of each year-end is as follows....
On January 1, 2017, Bridgeport Company purchased 11% bonds, having a maturity value of $274,000, for...
On January 1, 2017, Bridgeport Company purchased 11% bonds,
having a maturity value of $274,000, for $295,314.87. The bonds
provide the bondholders with a 9% yield. They are dated January 1,
2017, and mature January 1, 2022, with interest received on January
1 of each year. Bridgeport Company uses the effective-interest
method to allocate unamortized discount or premium. The bonds are
classified as available-for-sale category. The fair value of the
bonds at December 31 of each year-end is as follows....
On January 1, 2017, Bonita Company purchased 11% bonds, having a maturity value of $314,000, for...
On January 1, 2017, Bonita Company purchased 11% bonds, having a
maturity value of $314,000, for $338,426.53. The bonds provide the
bondholders with a 9% yield. They are dated January 1, 2017, and
mature January 1, 2022, with interest received on January 1 of each
year. Bonita Company uses the effective-interest method to allocate
unamortized discount or premium. The bonds are classified as
available-for-sale category. The fair value of the bonds at
December 31 of each year-end is as follows....
On January 1, 2017, Sage Company purchased 11% bonds, having a maturity value of $328,000, for...
On January 1, 2017, Sage Company purchased 11% bonds, having a
maturity value of $328,000, for $353,515.61. The bonds provide the
bondholders with a 9% yield. They are dated January 1, 2017, and
mature January 1, 2022, with interest received on January 1 of each
year. Sage Company uses the effective-interest method to allocate
unamortized discount or premium. The bonds are classified as
available-for-sale category. The fair value of the bonds at
December 31 of each year-end is as follows....
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Write in Python and as 2 seperate programs Write a program that allows the user to...
- Asymptotic Notation. (a) [10 pts.] Prove that n3 −91n2 −7n−14 = Ω(n3). Your answer must clearly...
- Prepare ONE Page reflection to the readings of the Perceptual Process incorporating as well one outside...
- How is the internet affecting our everyday life? I just need a rough draft for this...
- Please explain your view of the most difficult aspect of Customs Compliance?
- You are required to write an interactive program that prompts the user for seven (7) real...
- Describe in detail the five-forces model of industry competition. What causes each of the forces to...
ADVERTISEMENT