Gilooly Co. pur ased $78,0 year Lumpkin County bonds on May 11, ounty, at thel plus accrued interest. The bonds pay semiannual interest on April 1 and October 1. On October 31, Year 1, Gillooly Co. sold $30,000 of the Lumpkin County bonds at 101 plus $175 accrued interest less a $335 brokerage commission. Journalize the entries to record the following: Do not round interim calculations. Round final answers to nearest dollar. If an amount box does not require an entry, leave it blank. Assume a 360-day year. a. The purchase of the bonds on May 11 plus 40 days of accrued interest. Year 1 May 11 Investments-Lumpkin County Bondsv 78,000 Interest Receivable v 78,152 X Cash v 78,152 X Feedback b. Semiannual interest on October 1. Year 1 Oct. 1 Cash v 2,730 V Interest Receivable v 152 X Interest Revenue v 2,578 X Feedback c. Sale of the bonds on October 31.
Gilooly Co. pur ased $78,0 year Lumpkin County bonds on May 11, ounty, at thel plus accrued interest. The bonds pay semiannual interest on April 1 and October 1. On October 31, Year 1, Gillooly Co. sold $30,000 of the Lumpkin County bonds at 101 plus $175 accrued interest less a $335 brokerage commission. Journalize the entries to record the following: Do not round interim calculations. Round final answers to nearest dollar. If an amount box does not require an entry, leave it blank. Assume a 360-day year. a. The purchase of the bonds on May 11 plus 40 days of accrued interest. Year 1 May 11 Investments-Lumpkin County Bondsv 78,000 Interest Receivable v 78,152 X Cash v 78,152 X Feedback b. Semiannual interest on October 1. Year 1 Oct. 1 Cash v 2,730 V Interest Receivable v 152 X Interest Revenue v 2,578 X Feedback c. Sale of the bonds on October 31.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:FeedbacК
c. Sale of the bonds on October 31.
Cash
Year 1 Oct. 31
30,140
Loss on Sale of Investments
35
Interest Revenue
175
Investments-Lumpkin County Bonds
30,000
Feedback
d. Adjusting entry for accrued interest on December 31, Year 1.
Interest Receivable
Year 1 Dec. 31
849
Interest Revenue
849
Feedback
e. The receipt of the face value of the remaining bonds at their maturity on April 1, Year 20.
Cash
Year 20 Apr. 1
48,000
Investments-Lumpkin County Bonds
48,000
Transcribed Image Text:Gillooly Co. purchased $78,000 of 7%, 10-year Lumpkin County bonds on May 11, Year 1, directly from the county, at their face amount plus
accrued interest. The bonds pay semiannual interest on April 1 and October 1. On October 31, Year 1, Gillooly Co. sold $30,000 of the Lumpkin
County bonds at 101 plus $175 accrued interest less a $335 brokerage commission.
Journalize the entries to record the following: Do not round interim calculations. Round final answers to nearest dollar. If an amount
box does not require an entry, leave it blank. Assume a 360-day year.
a. The purchase of the bonds on May 11 plus 40 days of accrued interest.
Year 1 May 11 Investments-Lumpkin County Bonds
78,000
Interest Receivable
78,152
Cash v
78,152
Feedback
b. Semiannual interest on October 1.
Cash
Year 1 Oct. 1
2,730 V
Interest Receivable v
152 X
Interest Revenue
2,578
Feedback
c. Sale of the bonds on October 31.
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Step 1 Introduction
VIEWStep 2 a) Journal entry of purchase the bond
VIEWStep 3 b) Journal entry of received the semiannual Interest on October 1
VIEWStep 4 c) Journal entry of sale of the bonds on October 31.
VIEWStep 5 d) Journal entry of Accrued interest on 31st December
VIEWStep 6 e) Journal entry of after 10 years
VIEW
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