General Investment Co. (GIC) purchased bonds on January 1, 2021. GIC's accountant has projected the following amortization schedule from purchase until maturity: Date Cash Received Interest Revenue Amortization of Discount Amortized Cost 1/1/2021 $ 194,758 6/30/2021 $ 7,000 $ 7,790 $ 790 195,548 12/31/2021 7,000 7,822 822 196,370 6/30/2022 7,000 7,855 855 197,225 12/31/2022 7,000 7,889 889 198,114 6/30/2023 7,000 7,925 925 199,039 12/31/2023 7,000 7,961 961 200,000 Recording the bond purchase would have what effect on the financial statements?
General Investment Co. (GIC) purchased bonds on January 1, 2021. GIC's accountant has projected the following amortization schedule from purchase until maturity: Date Cash Received Interest Revenue Amortization of Discount Amortized Cost 1/1/2021 $ 194,758 6/30/2021 $ 7,000 $ 7,790 $ 790 195,548 12/31/2021 7,000 7,822 822 196,370 6/30/2022 7,000 7,855 855 197,225 12/31/2022 7,000 7,889 889 198,114 6/30/2023 7,000 7,925 925 199,039 12/31/2023 7,000 7,961 961 200,000 Recording the bond purchase would have what effect on the financial statements?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
General Investment Co. (GIC) purchased bonds on January 1, 2021. GIC's accountant has projected the following amortization schedule from purchase until maturity:
|
Date |
Cash Received |
Interest Revenue |
Amortization of Discount |
Amortized Cost |
|
||||||||||||
|
|
1/1/2021 |
|
|
|
|
|
|
|
|
|
|
$ |
194,758 |
|
|||
|
|
6/30/2021 |
$ |
7,000 |
|
$ |
7,790 |
|
|
$ |
790 |
|
|
195,548 |
|
|||
|
|
12/31/2021 |
|
7,000 |
|
|
7,822 |
|
|
|
822 |
|
|
196,370 |
|
|||
|
|
6/30/2022 |
|
7,000 |
|
|
7,855 |
|
|
|
855 |
|
|
197,225 |
|
|||
|
|
12/31/2022 |
|
7,000 |
|
|
7,889 |
|
|
|
889 |
|
|
198,114 |
|
|||
|
|
6/30/2023 |
|
7,000 |
|
|
7,925 |
|
|
|
925 |
|
|
199,039 |
|
|||
|
|
12/31/2023 |
|
7,000 |
|
|
7,961 |
|
|
|
961 |
|
|
200,000 |
|
|||
Recording the bond purchase would have what effect on the financial statements?
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