A11-6 FVOCI-Bond Method-Bond Investment: On 1 June 20X8, Ghana Company purchased $7,000,000 of Monaco Corp. S.8% bonds, classified as a FVOCH-Bond imvestment. The bonds pay semi-annual interest cach 30 May and 30 November. The market interest rate was 6% on the date of purchase. The bonds mature on 30 May 20X13. Required: Ecileulate the price pald by Ghana Company 2. Construct a table that shows interest revenue reported by Ghana, and the carrying value of the investment, for cach interest period for four interest periods. Use the effective-interest method. 3Give entries for 20X8 and for 20X9, including the yearend accrual, based on your caleulations in requirement2 4. At the yearend, 31 December 20X8 and 31 December 20X9, the fair value of the bonds was $7,240,000 and $6,755,000 respectively. Give the entries to record the changes in fair value.

A11-6 FVOCI-Bond Method-Bond Investment: On 1 June 20X8, Ghana Company purchased $7,000,000 of Monaco Corp. S.8% bonds, classified as a FVOCH-Bond imvestment. The bonds pay semi-annual interest cach 30 May and 30 November. The market interest rate was 6% on the date of purchase. The bonds mature on 30 May 20X13. Required: Ecileulate the price pald by Ghana Company 2. Construct a table that shows interest revenue reported by Ghana, and the carrying value of the investment, for cach interest period for four interest periods. Use the effective-interest method. 3Give entries for 20X8 and for 20X9, including the yearend accrual, based on your caleulations in requirement2 4. At the yearend, 31 December 20X8 and 31 December 20X9, the fair value of the bonds was $7,240,000 and $6,755,000 respectively. Give the entries to record the changes in fair value.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable

Section: Chapter Questions

Problem 7P: Wilbury Corporation issued 1 million of 13.5% bonds for 985,071.68. The bonds are dated and issued...

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