InstructionsChart of AccountsOn February 1, 2020, Aggie Corporation sold its investment in Smith Corporation bonds for $12,500. The bonds have a faceCHART OF ACCOUNTSvalue of $12,000 and a stated interest rate of 10%. The market value of the bonds on December 31, 2019 was $12,300.Aggie CorporationRequired:General LedgerPrepare the journal entries to record the sale of the bonds and the adjustments of the unrealized gain or loss.ASSETSREVENUE111 Cash411 Sales Revenue113 Investment in Trading Securities431 Interest Income114 Investment in Available-for-Sale Securities441 Gain on Sale of Available-for-SaleGeneral Journal117 Interest ReceivableSecurities119 Allowance for Change in Fair Value of Investment121 Accounts ReceivableEXPENSESPrepare the journal entries to record the sale of the bonds and the adjustments of the unrealized gain or loss on February 1, 2020.500 Cost of Goods Sold141 Inventory152 Prepaid Insurance511 Insurance ExpenseGeneral Journal Instructions181 Equipment512 Utilities Expense189 Accumulated Depreciation521 Salaries Expense191 Investment in Held-to-Maturity Debt Securities532 Bad Debt ExpensePAGE 1540 Interest ExpenseGENERAL JOURNALLIABILITIES541 Depreciation ExpenseDATEACCOUNT TITLEPOST. REF.DEBITCREDIT211 Accounts Payable559 Miscellaneous ExpensesFeb. 1Cash12,500.00231 Salaries Payable910 Income Tax ExpenseAccounts Payable12,500.002250 Unearned RevenueGain on Sale of Available-for-Sale Securities200.00261 Income Taxes PayableFeb. 1 Unrealized Holding Gain/Loss: Available-for-Sale Securities300.0045300.00EQUITY311 Common Stock331 Retained Earnings339 Unrealized Holding Gain/Loss: Available-for-SaleSecurities

Instructions On February 1, 2020, Aggie Corporation sold its investment in Smith Corporation bonds for $12,500. The bonds have a face value of $12.000 and a stated interest rate of 10%. The market value of the bonds on December 31, 2019 was $12.300. Required: Prepare the journal entries to record the sale of the bonds and the adjustments of the unrealized gain or loss.

Instructions On February 1, 2020, Aggie Corporation sold its investment in Smith Corporation bonds for $12,500. The bonds have a face value of $12.000 and a stated interest rate of 10%. The market value of the bonds on December 31, 2019 was $12.300. Required: Prepare the journal entries to record the sale of the bonds and the adjustments of the unrealized gain or loss.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Seaview Company issued $200,000 of 15-year, 9% callable bonds payable on July 31, 2025, at 97. On July 31, 2028, Seaview Company called the bonds at 101. Assume annual interest payments. Requirements 1. Without making journal entries, compute the carrying amount of the bonds payable at July 31, 2028. 2. Assume all amortization has been recorded properly. Journalize the retirement of the bonds on July 31, 2028. No explanation is required. Requirement 1. Without making journal entries, compute the carrying amount of the bonds payable at July 31, 2028. (Assume bonds payable are amortized using the straight-line amortization method.) First, complete the sentences below. The carrying amount of the bonds payable at issuance (July 31, 2025) is issuance amounts to $ 6,000 $ 194,000. The discount on the bonds at The carrying amount of the bonds payable at July 31, 2028 is $ 195,200 Requirement 2. Assume all amortization has been recorded properly. Journalize the retirement of the bonds on July…
On June 30, 2021, Waterway Industries had outstanding 8%, $8020000 face amount, 15-year bonds maturing on June 30, 2031. Interest is payable on June 30 and December 31. The unamortized balance in the bond discount account on June 30, 2021 was $361000. On June 30, 2021, Waterway acquired all of these bonds at 94 and retired them. What net carrying amount should be used in computing gain or loss on this early extinguishment of debt? $7538800. $7659000. $7939000. $7739200.
Determining the present value of bonds payable and journalizing using the effective-interest amortization method Brad Nelson, Inc. issued $600,000 of 7%, six-year bonds payable on January 1, 2018. The market interest rate at the date of issuance was 6%, and the bonds pay interest semiannually. Requirements How much cash did the company receive upon issuance of the bonds payable? (Round to the nearest dollar.) Prepare an amortization table for the bond using the effective-interest method, through the first two interest payments. (Round to the nearest dollar.) Journalize the issuance of the bonds on January 1, 2018, and the first and second payments of the semiannual interest amount and amortization of the bonds on June 30, 2018, and December 31, 2018. Explanations are not required.
Freddy Corporation purchased $1,500,000, 8%, five year bonds on January 1, 2018. Interest is payable on December 31 of each year. When the bonds were issued the market rate was 10%. Freddy records the following transactions. Round all calculations to the nearest dollar. See attached spreadsheet I. Prepare the journal entry for the purchase of the securities which are classified as Available for Sale securities. Prepare all journal entries required on December 31, 2019. Freddy uses the effective interest amortization method. On December 31, 2019, the fair market value of the bonds was $1,450,000. The fair market value of the bonds on December 31, 2018, was $1,500,000.
Subject: acounting
prepare the appropriate journal entry for the redemption or conversion of the bonds. Pharoah Company redeemed $155,000 face value, 17% bonds on June 30, 2020, at 96. The carrying value of the bonds at the redemption date was $158,000. The bonds pay annual interest, and the interest payment due on June 30, 2020, has been made and recorded.
On January 1, 2019, Assarain Concrete issued bonds with a face value of OMR 100,000 at 97, due in January 1, 2029. On January 1, 2025, the entire issue was retired at 100 and cancelled. How much is the gain or loss from retirement of bonds? a. Loss RO 900 b. Loss RO 1,200 c. Gain RO 1,200 d. Gain RO 900
Visno
Subject : Accounting
On August 1, 2025, Sandhill Company acquired $460000 face value 9% bonds of Wildhorse Corporation at 103 plus accrued interest. The bonds were dated May 1, 2025, and mature on April 30, 2030, with interest payable each October 31 and April 30. The bonds will be held to maturity. What entry should Sandhill make to record the purchase of the bonds on August 1, 2025? Debt Investments Interest Revenue Cash Debt Investments Premium on Bonds Cash Debt Investments Cash Debt Investments Interest Revenue Cash 473800 10350 460000 24150 484150 484150 484150 484150 484150 10350 473800