3. The bonds provide the bondholders with a 10% yield. They are dated January 1, 2022, and mature on January t receivable on December 31 of each year. Whispering Winds and Lois Company uses the effective interest meth mortized discount or premium. The bonds are carried at FV-OCI. The fair value of the bonds at December 31 of e Ows
3. The bonds provide the bondholders with a 10% yield. They are dated January 1, 2022, and mature on January t receivable on December 31 of each year. Whispering Winds and Lois Company uses the effective interest meth mortized discount or premium. The bonds are carried at FV-OCI. The fair value of the bonds at December 31 of e Ows
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
answer in text form please (without image), Note: .Every entry should have narration please
Transcribed Image Text:On January 1, 2022, Whispering Winds and Lois Company purchased 12% bonds having a maturity value of $342,000 for
$367,928.98. The bonds provide the bondholders with a 10% yield. They are dated January 1, 2022, and mature on January 1, 2027,
with interest receivable on December 31 of each year. Whispering Winds and Lois Company uses the effective interest method to
allocate unamortized discount or premium. The bonds are carried at FV-OCI. The fair value of the bonds at December 31 of each year-
end is as follows:
2022
2023
(a)
$365,500
$352,000
Prepare the journal entries to record the interest received and recognition of fair value for 2022. (Credit account titles are
automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles
and enter o for the amounts. List all debit entries before credit entries. Round answers to 2 decimal places, e.g. 52.75.)
Date Account Titles and Explanation
Dec. 31
Dec. 31
(To record collection of interest)
(To record fair value adjustment)
Debit
Credit
|||
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