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

14th Edition

ISBN:9781305088436

Author:Carl Warren, Jim Reeve, Jonathan Duchac

Publisher:Carl Warren, Jim Reeve, Jonathan Duchac

Chapter15: Investments And Fair Value Accounting

Section: Chapter Questions

Problem 4E

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