Comprehensive Problem 4 (Part A)InstructionsChart of AccountsJournalInstructionsRecord on journal page 11:Oct.1Purchased $90,000 of Dream Inc. 10-year, 5% bonds, directly from the issuing company, at their faceamount plus accrued interest of $375. The bonds are a held-to-maturity investment.Sold, at $38 per share, 2,600 shares of treasury common stock purchased on Jun. 8.14Received interest of $6,000 from the Solstice Corp. investment on Jun. 1.29Sold Solstice Corp. bonds with a face value of $40,020 for $45,000, realizing a gain of $4,980.31Recorded the payment of semiannual interest on the bonds issued on May 1 and the amortization ofthe premium for 6 months. The amortization is determined using the straight-line method.Dec.31Accrued interest for 3 months on the Dream Inc. bonds purchased on Oct. 1.31Pinkberry Co. reported total earnings of $240,000. Equinox Products recorded its share of PinkberryCo. net income using the equity method.31The Solstice Corp. bonds have a fair value of $253,630 on December 31, 20Y5. Valuation Allowancefor Available-for-Sale Investments had a balance of zero on January 1, 20Y5.Required:

Journal entries are those transactions which are recorded in the books of entity and it is the…

1 Purchased $90,000 of Dream Inc. 10-year, 5% bonds, directly from the issuing company, a amount plus accrued interest of $375. The bonds are a held-to-maturity investment. 7 Sold, at $38 per share, 2,600 shares of treasury common stock purchased on Jun. 8. 4 Received interest of $6,000 from the Solstice Corp. investment on Jun. 1.

1 Purchased $90,000 of Dream Inc. 10-year, 5% bonds, directly from the issuing company, a amount plus accrued interest of $375. The bonds are a held-to-maturity investment. 7 Sold, at $38 per share, 2,600 shares of treasury common stock purchased on Jun. 8. 4 Received interest of $6,000 from the Solstice Corp. investment on Jun. 1.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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