Carla Vista Company purchased, on January 1, 2025, as an available-for-sale security, $73,000 of the 10%, 5-year bonds of Tri Town Corporation for $67,737, which provides an 12% return. Prepare Carla Vista’s journal entries for (a) the purchase of the investment, (b) the receipt of annual interest and discount amortization, and (c) the year-end fair value adjustment. (Assume a zero balance in the Fair Value Adjustment account.) The bonds have a year-end fair value of $69,350. Assume effective-interest amortization is used. (List all debit entries before credit entries. Credi
Carla Vista Company purchased, on January 1, 2025, as an available-for-sale security, $73,000 of the 10%, 5-year bonds of Tri Town Corporation for $67,737, which provides an 12% return.
Prepare Carla Vista’s
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