On January 1, 2019, Kelly Corporation acquired bonds with a face value of $400,000 for $386,808.18, a price that yields a 9% effective annual interest rate. The bonds carry a 8% stated rate of interest, pay interest semiannually on June 30 and December 31, are due December 31, 2022, and are being held to maturity. Required:   Prepare journal entries to record the purchase of the bonds and the first two interest receipts using the:   1. straight-line method of amortization 2. effective interest method of amortization

Q: On January 1, 2022, Kristopher Co. issued ten-year bonds with a face value of $6,000,000 and a…

A: The bonds are the financial instruments of the business. The bonds are reported as long term…

Q: Chowan Corporation issued $198,000 of 8% bonds dated January 1, 2019, for $191,470.07 on January 1,…

A: Discount on bonds payable is first calculated which is the difference of Bonds par value and the…

Q: Prepare a bond interest expense and premium amortization schedule using the straight-line method. 2.…

A: Under the Straight line method, a Bond premium or discount is amortized equally over the bond term…

Q: Record the purchase of the bonds. 2. Prepare an investment interest income and discount amortization…

A: 1. Below is the Journal Entry for the Purchase of the Bonds Date  Particulars   Debit   Credit…

Q: Sheridan Company issued $279,000, 9%, 15-year bonds on December 31, 2021, for $267,840. Interest is…

A: In the given question we need to prepare the journal entries for following: (a)The issuance of the…

Q: On January 1, 2025, Flounder Company purchased 8% bonds having a maturity value of $200,000 for…

A: Debt investment seems to be a sort of investment within a corporation or project that involves…

Q: Stark Ltd sold IDR 6,200,000, 10%, 10-year bonds on January 1, 2019. The bonds were dated January i…

A: No. Date Account Titles and Explanation Debit Credit 1. January 1, 2019 Cash (IDR…

Q: On January 1, 2019, Calvert Company issues 11%, $100,000 face value bonds for $103,587.53, a price…

A: Lets understand the basics.Premium of discount on issue of bond can be amortized using,(1) Effective…

Q: Metlock, Inc. issued $282,000, 7%, 15-year bonds on December 31, 2021, for $253,800. Interest is…

A: Total discount on bonds = Face value of bonds - issue value of bonds = 282000-253800 = $28,200

Q: pany issues four-year bonds with a $105,000 par value on January 1, 2021, at a price of $100,950.…

A: Bonds are debt instruments which are issued to raise money from investors. Bonds may be issued at…

Q: On January 1, 2019, Castle Services issued $177,000 of six-year, 12% bonds when the market interest…

A: The bonds are issued at premium when market rate is lower than the coupon rate of bonds payable. The…

Q: On January 1, 2021, Universe of Fun issues $900,000, 8% bonds that mature in 10 years. The market…

A: Bonds: This is just like debt for the issue of investors by the company. Bond is dependent on the…

Q: The Golden Company issues $539,000 of 7%, 10-year bonds at 104 on March 31, 2019. The bonds pay…

A: An interest-bearing bond is a type of debt security issued by a borrower, typically a corporation or…

Q: Valdez issues $450,000 of 13%, four-year bonds dated January 1, 2019, that pay interest semiannually…

A: Since there are multiple sub parts, the calculation will be given for first three sub parts. To get…

Q: Hillside issues $4,000,000 of 6%, 15-year bonds dated January 1, 2019, that pay interest…

A: The question is based on the concept of the issue of securities. As per Bartleby guidelines we are…

Q: On December 31, 2018, White Company issued $400,000 of five-year, 12% bonds payable for $430,887,…

A: Premium on bonds = Issue value - Face value = $430,887 - $400,000 = $30,887

Q: Hillside issues $1,500,000 of 6%, 15-year bonds dated January 1, 2019, that pay interest…

A: In this question, information related to bonds was given, on the basis of which we have to make an…

Q: On January 1, 2019, Lynch Company acquired 13% bonds with a face value of $50,000. The bonds pay…

A: Answer:-  Bond meaning:- An IOU-like debt security called a bond. Bonds are issued by the borrowers…

Q: Deleau Equipment Ltd. issued 11%, five-year bonds with a face value of $80,240,000 on October 1,…

A: Journal Entry: Journal entry is the act of keeping records of transactions in an accounting journal.…

Q: prepare the journal entry to record the sale of these bonds on January 1, 2022. Crane Company issues…

A: >Bonds Payable are the source of finance for the companies.>The bondholders are entitled for a…

Q: Crane Company issued $310,000,6 %, 10-year bonds on January 1, 2022, for $333,936. This price…

A: The amortization of premium on bond issue decreases the carrying value of bond payable and the…

Q: Polk Incorporated issued $200,000 of 13% bonds on July 1, 2019, for $206,801.60. The bonds were…

A: The following computations are done for Polk Incorporation.

Q: Laudie Company issued $400,000 of 5%, 10-year bonds on January 1, 2020, at 94. Interest is payable…

A: "Since you have asked multiple questions, we will solve first question for you. If you want any…

Q: Hillside issues $1,900,000 of 5%, 15-year bonds dated January 1, 2019, that pay interest…

A: Face value of bond = $ 1,900,000                             Issue price of bond = $ 1,641,812…

Q: On January 1, 2019, Booth Sales issues $10,000 in bonds for $10,900. These are 5-year bonds with a…

A: Semiannual interest payment = Face value of bonds * Annual stated rate * 6/12 Semiannual premium…

Q: Prepare journal entries for the following transactions.

A: Bonds are issued by large organization to raise the fund. Bonds are considered as debt securities…

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.