On January 1, 2020, Kingbird, Inc. purchased 11% bonds having a maturity value of $541,000 for $558,147.37. The bonds provide the bondholders with an 10% yield. The bonds are dated January 1, 2020, and mature January 1, 2024, with interest receivable on January 1 of each year. Kingbird, Inc. uses the effective interest method to allocate unamortized discount or premium. The bonds are classified as available-for-sale. The fair value of the bonds at December 31 of each year-end is as follows. 2020 $550,800 2021 $551,800 2022 $546,300 2023 $541,000 Prepare the journal entry at the date of the bond purchase. (Round answers to 2 decimal places, e.g. 5,125.67. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit Jan. 1, 2020 enter an account title for the journal entry on January 1, 2017 enter a debit amount enter a credit amount enter an account title for the journal entry on January 1, 2017 enter a debit amount enter a credit amount Prepare the journal entries to record the interest revenue and recognition of fair value for 2020. (Round answers to 2 decimal places, e.g. 5,125.67. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31, 2020 enter an account title to record the interest revenue on December 31, 2017 enter a debit amount enter a credit amount enter an account title to record the interest revenue on December 31, 2017 enter a debit amount enter a credit amount enter an account title to record the interest revenue on December 31, 2017 enter a debit amount enter a credit amount (To record interest revenue) enter an account title to record the recognition of fair value on December 31, 2017 enter a debit amount enter a credit amount enter an account title to record the recognition of fair value on December 31, 2017 enter a debit amount enter a credit amount (To record recognition of fair value) Prepare the journal entry to record the recognition of fair value for 2021. (Round answers to 2 decimal places, e.g. 5,125.67. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31, 2021 enter an account title for the journal entry on December 31, 2018 enter a debit amount enter a credit amount enter an account title for the journal entry on December 31, 2018

On January 1, 2020, Kingbird, Inc. purchased 11% bonds having a maturity value of $541,000 for $558,147.37. The bonds provide the bondholders with an 10% yield. The bonds are dated January 1, 2020, and mature January 1, 2024, with interest receivable on January 1 of each year. Kingbird, Inc. uses the effective interest method to allocate unamortized discount or premium. The bonds are classified as available-for-sale. The fair value of the bonds at December 31 of each year-end is as follows. 2020 $550,800 2021 $551,800 2022 $546,300 2023 $541,000 Prepare the journal entry at the date of the bond purchase. (Round answers to 2 decimal places, e.g. 5,125.67. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit Jan. 1, 2020 enter an account title for the journal entry on January 1, 2017 enter a debit amount enter a credit amount enter an account title for the journal entry on January 1, 2017 enter a debit amount enter a credit amount Prepare the journal entries to record the interest revenue and recognition of fair value for 2020. (Round answers to 2 decimal places, e.g. 5,125.67. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31, 2020 enter an account title to record the interest revenue on December 31, 2017 enter a debit amount enter a credit amount enter an account title to record the interest revenue on December 31, 2017 enter a debit amount enter a credit amount enter an account title to record the interest revenue on December 31, 2017 enter a debit amount enter a credit amount (To record interest revenue) enter an account title to record the recognition of fair value on December 31, 2017 enter a debit amount enter a credit amount enter an account title to record the recognition of fair value on December 31, 2017 enter a debit amount enter a credit amount (To record recognition of fair value) Prepare the journal entry to record the recognition of fair value for 2021. (Round answers to 2 decimal places, e.g. 5,125.67. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit Dec. 31, 2021 enter an account title for the journal entry on December 31, 2018 enter a debit amount enter a credit amount enter an account title for the journal entry on December 31, 2018

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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2020		$550,800
2021		$551,800
2022		$546,300
2023		$541,000

Prepare the journal entry at the date of the bond purchase. (Round answers to 2 decimal places, e.g. 5,125.67. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Date	Account Titles and Explanation	Debit	Credit
Jan. 1, 2020	enter an account title for the journal entry on January 1, 2017	enter a debit amount	enter a credit amount
	enter an account title for the journal entry on January 1, 2017	enter a debit amount	enter a credit amount

Prepare the journal entries to record the interest revenue and recognition of fair value for 2020. (Round answers to 2 decimal places, e.g. 5,125.67. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Date	Account Titles and Explanation	Debit	Credit
Dec. 31, 2020	enter an account title to record the interest revenue on December 31, 2017	enter a debit amount	enter a credit amount
	enter an account title to record the interest revenue on December 31, 2017	enter a debit amount	enter a credit amount
	enter an account title to record the interest revenue on December 31, 2017	enter a debit amount	enter a credit amount
	(To record interest revenue)
	enter an account title to record the recognition of fair value on December 31, 2017	enter a debit amount	enter a credit amount
	enter an account title to record the recognition of fair value on December 31, 2017	enter a debit amount	enter a credit amount
	(To record recognition of fair value)

Prepare the journal entry to record the recognition of fair value for 2021. (Round answers to 2 decimal places, e.g. 5,125.67. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Date	Account Titles and Explanation	Debit	Credit
Dec. 31, 2021	enter an account title for the journal entry on December 31, 2018	enter a debit amount	enter a credit amount
	enter an account title for the journal entry on December 31, 2018

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