Entries for bond (held-to-maturity) investmentsThe following bond investment transactions were completed by Starks Company:Jan. 31Purchased 51, $1,000 government bonds at 100 plus accrued interest of $255 (1 month). The bonds pay 6% annual interest onJuly 1 and January 1.July 1Aug. 30Received semiannual interest on bond investment.Sold 21, $1,000 bonds at 96 plus $210 accrued interest (2 months).a. Journalize the entries for these transactions. Assume a 360-day year. Do not round interim calculations. Round final answers to nearest dollar. If an amountbox does not require an entry, leave it blank.Jan. 31 Investments-Government BondsInterest ReceivableCashJuly 1CashInterest ReceivableInterest RevenueAug. 30 Cash- VInterest Revenue DVInvestments Government BondsFeedback✓000 000000 000 00000000I b. Journalize the December 31 adjusting entry for semiannual interest earned on the bonds. Assume a 360-day year. Do not round interim calculations. Round finalanswers to nearest dollar. If an amount box does not require an entry, leave it blank.Dec. 31 Interest ReceivableInterest RevenueFeedbackCheck My Workb. Remember to accrue the interest only on the remaining bonds after the sale. Use the same formula as in part a adjusted for the appropriate time period.c. Journalize the receipt of $30,000 at the bonds' maturity on July 1. If an amount box does not require an entry, leave it blank.July 1 Cash✔88Investments-Government Bonds

Journal entry is the process of maintaining or producing records of any transactions, whether they…

Entries for bond (held-to-maturity) investments The following bond investment transactions were completed by Starks Company: Jan. 31 Purchased 51, $1,000 government bonds at 100 plus accrued interest of $255 (1 month). The bonds pay 6% annual interest on July 1 and January 1. July 1 Aug. 30 Received semiannual interest on bond investment. Sold 21, $1,000 bonds at 96 plus $210 accrued interest (2 months). a. Journalize the entries for these transactions. Assume a 360-day year. Do not round interim calculations. Round final answers to nearest dollar. If an amount box does not require an entry, leave it blank. Jan. 31 Investments-Government Bonds Interest Receivable Cash July 1 Interest Receivable Interest Revenue Aug. 30 Cash -V Loss on Sale of Investments Interest Revenue lavestments Government bonds 000 000 000 000 0000 0000

Entries for bond (held-to-maturity) investments The following bond investment transactions were completed by Starks Company: Jan. 31 Purchased 51, $1,000 government bonds at 100 plus accrued interest of $255 (1 month). The bonds pay 6% annual interest on July 1 and January 1. July 1 Aug. 30 Received semiannual interest on bond investment. Sold 21, $1,000 bonds at 96 plus $210 accrued interest (2 months). a. Journalize the entries for these transactions. Assume a 360-day year. Do not round interim calculations. Round final answers to nearest dollar. If an amount box does not require an entry, leave it blank. Jan. 31 Investments-Government Bonds Interest Receivable Cash July 1 Interest Receivable Interest Revenue Aug. 30 Cash -V Loss on Sale of Investments Interest Revenue lavestments Government bonds 000 000 000 000 0000 0000

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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Bond Investment TransactionsJournalize the entries to record the following selected bond investment transactions for Starks Products:For a compound transaction, if an amount box does not require an entry, leave it blank.a. Purchased for cash $72,000 of Iceline, Inc. 9% bonds at 100 plus accrued interest of $1,080, paying interest semiannually. b. Received first semiannual interest payment. c. Sold $48,000 of the bonds at 103 plus accrued interest of $550.
Micro Computer Company has set up a toll - free telephone line for customer inquiries regarding computer hardware produced by the company. The cost of this toll - free line would be classified as which of the following for financial reporting purposes? A. Product cost B. Manufacturing overhead C. Period cost D. Answers A and B are correct E. Answers B and C are correct
Entries for Issuing and Calling Bonds; Gain Mia Breen Corp. produces and sells wind-energy-driven engines. To finance its operations, Mia Breen issued $22,000,000 of 20-year, 4% callable bonds on May 1, 20Y5, at their face amount, with interest payable on May 1 and November 1. The fiscal year of the company is the calendar year. Journalize the entries to record the following selected transactions: 20Y5 May 1 Nov. 1 Paid the interest on the bonds. 20Y9 Issued the bonds for cash at their face amount. Nov. 1 Called the bond issue at 97, the rate provided in the bond indenture. (Omit entry for payment of interest.) If an amount box does not require an entry, leave it blank. Issued the bonds for cash at their face amount. 20Y5 May 1 Paid the interest on the bonds. 20Y5 Nov. 1 Called the bond issue at 97, the rate provided in the bond indenture. (Omit entry for payment of interest.). 20Y9 Nov. 1
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Bond Premium, Entries for Bonds Payable Transactions Rodgers Corporation produces and sells football equipment. On July 1, Year 1, Rodgers Corporation issued $60,200,000 of 10-year, 12% bonds at a market (effective) interest rate of 10%, receiving cash of $67,702,281. Interest on the bonds is payable semiannually on December 31 and June 30. The fiscal year of the company is the calendar year. Required: For all journal entries, If an amount box does not require an entry, leave it blank. 1. Journalize the entry to record the amount of cash proceeds from the issuance of the bonds on July 1, Year 1. - Select - - Select - - Select - - Select - - Select - - Select - 2. Journalize the entries to record the following: a. The first semiannual interest payment on December 31, Year 1, and the amortization of the bond premium, using the straight-line method. Round to the nearest dollar. - Select - - Select - - Select - - Select -…
Entries for bond (held-to-maturity) investments The following bond investment transactions were completed by Starks Company: Jan. 31 Purchased 39, $1,000 government bonds at 100 plus accrued interest of $195 (1 month). The bonds pay 6% annual interest on July 1 and January 1. July 1 Received semiannual interest on bond investment. Aug. 30 Sold 15, $1,000 bonds at 97 plus $150 accrued interest (2 months). a. Journalize the entries for these transactions. Assume a 360-day year. Do not round interim calculations. Round final answers to nearest dollar. If an amount box does not require an entry, leave it blank. Jan. 31 Investments-Government Bonds Interest Receivable Cash July 1 Cash Interest Receivable Interest Revenue Aug. 30 Cash Sale of Investments Interest Revenue InvestmentsInvestments-Government Bonds b. Journalize the December 31 adjusting entry for semiannual interest…
The following transactions were completed by Winklevoss Inc., whose fiscal year is the calendar year: 20Y1 July 1 Issued $74,000,000 of 20-year, 11% callable bonds dated July 1, 20Y1, at a market (effective) rate of 13%, receiving cash of $63,532,267. Interest is payable semiannually on December 31 and June 30. Dec. 31 Paid the semiannual interest on the bonds. The bond discount amortization of $261,693 is combined with the semiannual interest payment. 20Y2 June 30 Paid the semiannual interest on the bonds. The bond discount amortization of $261,693 is combined with the semiannual interest payment. Dec. 31 Paid the semiannual interest on the bonds. The bond discount amortization of $261,693 is combined with the semiannual interest payment. 20Y3 June 30 Recorded the redemption of the bonds, which were called at 98. The balance in the bond discount account is $9,420,961 after payment of interest and amortization of discount have been recorded. (Record the…
Bond Premium, Entries for Bonds Payable Transactions Rodgers Corporation produces and sells football equipment. On July 1, 20Y1, Rodgers issued $77,800,000 of 10-year, 12% bonds at a market (effective) interest rate of 10%, receiving cash of $87,495,638. Interest on the bonds is payable semiannually on December 31 and June 30. The fiscal year of the company is the calendar year. Required: For all journal entries, if an amount box does not require an entry, leave it blank. 1. Journalize the entry to record the amount of cash proceeds from the issuance of the bonds on July 1, 20Y1. Cash Premium on Bonds Payable Bonds Payable Feedback Bonds Payable is always recorded at face value. Any difference in issue price is reflected in a premium or discount account. 2. Journalize the entries to record the following: a. The first semiannual interest payment on December 31, 20Y1, and the amortization of the bond premium, using…
Entries for Issuing and Calling Bonds; Gain Emil Corp. produces and sells wind-energy-driven engines. To finance its operations, Emil Corp. issued $771,000 of 25-year, 13% callable bonds on May 1, 20Y1, at their face amount, with interest payable on May 1 and November 1. The fiscal year of the company is the calendar year. Journalize the entries to record the following selected transactions: 20Y1 May 1 Issued the bonds for cash at their face amount. Nov. 1 Paid the interest on the bonds. 20Y5 Nov. 1 Called the bond issue at 96, the rate provided in the bond indenture. (Omit entry for payment of interest.) Question Content Area Issued the bonds for cash at their face amount. If an amount box does not require an entry, leave it blank. 20Y1, May 1 - Select - - Select - - Select - - Select - Question Content Area Paid the interest on the bonds. If an amount box does not require an entry, leave it blank. 20Y1, Nov. 1 - Select -…
Bond Discount, Entries for Bonds Payable Transactions On July 1, 20Y1, Livingston Corporation, a wholesaler of manufacturing equipment, issued $46,000,000 of 20-year, 10% bonds at a market (effective) interest rate of 11%, receiving cash of $42,309,236. Interest on the bonds is payable semiannually on December 31 and June 30. The fiscal year of the company is the calendar year. Required: For all journal entries, if an amount box does not require an entry, leave it blank. Journalize the entry to record the amount of cash proceeds from the issuance of the bonds on July 1, 20Y1. 20Y1 July 1 1. Accounts Payable Bonds Payable Cash Interest Expense Interest Payable Premium on Bonds Payable 2. Accounts Payable Bonds Payable Discount on Bonds Payable Interest Expense Interest Payable Premium on Bonds Payable 3. Bonds Payable Cash Discount on Bonds Payable Interest Expense Interest Payable Premium on Bonds Payable Journalize the entries to record the following: The first semiannual…
Bond (held-to-maturity) investments The following bond investment transactions were completed by Starks Company: Jan. 31. Purchased $90,000 government bonds as a held-to-maturity investment at 100 plus accrued interest for 1 month. The bonds pay 7% annual interest on July 1 and January 1. July 1. Received semiannual interest on bond investment. Aug. 30. Sold $24,000 bonds at 99 plus accrued interest for 2 months. a. Journalize the entries for the preceding transactions. If an amount box does not require an entry, leave it blank. Jan. 31 Investments-Government Bonds July 1 Interest Receivable Cash Cash Interest Receivable Interest Revenue Aug. 30 Cash Loss on Sale of Investments Interest Revenue Investments-Government Bonds 90,000 525 3,150 24,240 X 285 X 90,525 525 2,625 525 X 24,000
Bond Premium, Entries for Bonds Payable Transactions Rodgers Corporation produces and sells football equipment. On July 1, 20Y1, Rodgers issued $81,300,000 of 10-year, 12% bonds at a market (effective) interest rate of 10%, receiving cash of $91,431,817. Interest on the bonds is payable semiannually on December 31 and June 30. The fiscal year of the company is the calendar year. Required: For all journal entries, if an amount box does not require an entry, leave it blank. 1. Journalize the entry to record the amount of cash proceeds from the issuance of the bonds on July 1, 20Y1. 2. Journalize the entries to record the following: a. The first semiannual interest payment on December 31, 20Y1, and the amortization of the bond premium, using the straight-line method. Round to the nearest dollar. b. The interest payment on June 30, 20Y2, and the amortization of the bond premium, using the straight-line method. Round to the nearest dollar 3. Determine the total…