On January 1, 2019, Alpha Corp purchased $1Million, 6% five year bonds to yield 8%. The$60,000 coupon was paid annually. Alphapaid $920,146 for the bonds because themarket rate exceeded the stated rate. Alphaconsidered this investment as Available forSale. Note: you do not need any PV tables tomake any of these calculations. On December31, 2019, the fair value of the bonds was$950,000. On December 31, 2020, thecarrying value of the bonds moved to$948,458; the fair value of the bonds was$940,000.1. Provide the journal entry for the initialinvestment.2. Provide the journal entry at December 31,2019 for the cash payment; please make asecond entry to mark the investment tomarket3.Provide the journal entry on December 31,2020 to mark the investment to market (hint:no calculation of interest or journal entry forthe payment is necessary- I'have alreadydone this for you)

1. Initial investment Date Particulars Debit Credit Jan 1, 2019 Available for sale investment…

1. Provide the journal entry for the initial investment. 2. Provide the journal entry at December 31, 2019 for the cash payment; please make a second entry to mark the investment to market 3.Provide the journal entry on December 31, 2020 to mark the investment to market (hint: no calculation of interest or journal entry for

1. Provide the journal entry for the initial investment. 2. Provide the journal entry at December 31, 2019 for the cash payment; please make a second entry to mark the investment to market 3.Provide the journal entry on December 31, 2020 to mark the investment to market (hint: no calculation of interest or journal entry for

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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