On January 1, 2020, Sunland Company purchased 8% bonds having a maturity value of $ 400,000, for \$433.699.52 The bonds provide the bondholders with a 6% yield. They are dated January 1, 2020, and mature January 1, 2025, with interest received on January 1 of each yearSunland Company uses the effective - interest method to allocate unamortized discount or premium. The bonds are classified in the held -to-maturity category (a) Prepare the journal entry at the date of the purchase. (Enter answers to 2 decimal places, 2, 525.25. 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 for the amounts) DateAccount Titles and Explanation DebitCredit Jan. 1 2020

On January 1, 2020, Sunland Company purchased 8% bonds having a maturity value of $ 400,000, for \$433.699.52 The bonds provide the bondholders with a 6% yield. They are dated January 1, 2020, and mature January 1, 2025, with interest received on January 1 of each yearSunland Company uses the effective - interest method to allocate unamortized discount or premium. The bonds are classified in the held -to-maturity category (a) Prepare the journal entry at the date of the purchase. (Enter answers to 2 decimal places, 2, 525.25. 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 for the amounts) DateAccount Titles and Explanation DebitCredit Jan. 1 2020

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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On January 1, 2020, Sandhill Company purchased 12% bonds, having a maturity value of $325,000 for $349,639.81. The bonds provide the bondholders with a 10% yield. They are dated January 1, 2020, and mature January 1, 2025, with interest received on January 1 of each year. Sandhill Company uses the effective-interest method to allocate unamortized discount or premium. The bonds are classified as available-for-sale category. The fair value of the bonds at December 31 of each year-end is as follows. 2020 $347,400 2023 $334,900 2021 $333,800 2024 $325,000 2022 $332,800 (a) Prepare the journal entry at the date of the bond purchase. (b) Prepare the journal entries to record the interest revenue and recognition of fair value for 2020. (c) Prepare the journal entry to record the recognition of fair value for 2021. (Round answers to 2 decimal places, e.g. 2,525.25. Credit account titles are automatically indented when amount is…
On January 1, 2020, Cullumber Company purchased 6% bonds, having a maturity value of $600,000 for $518,458. The bonds provide the bondholders with a 8% yield. They are dated January 1, 2020, and mature January 1, 2027, with interest paid on June 30 and December 31 of each year. Cullumber Company uses the effective-interest method to allocate unamortized discount or premium. The bonds are classified as available-for-sale category. The fair value of the bonds at December 31 of each year-end is as follows. 2020 $519,000 2023 $539,000 $514,000 2024 $559,000 $509,000 2021 2022 (a) (b) (c) Prepare the journal entry at the date of the bond purchase. Prepare the journal entries to record the interest revenue and recognition of fair value for 2020. Prepare the journal entry to record the recognition of fair value for 2021.
On January 1, 2020, Cheyenne Company purchased 5% bonds, having a maturity value of $570,000 for $488,989. The bonds provide the bondholders with a 7% yield. They are dated January 1, 2020, and mature January 1, 2027, with interest paid on June 30 and December 31 of each year. Cheyenne Company uses the effective-interest method to allocate unamortized discount or premium. The bonds are classified as available-for-sale category. The fair value of the bonds at December 31 of each year-end is as follows. 2020 $490,000 2023 $510,000 2021 $485,000 2024 $530,000 2022 $480,000 (a) Prepare the journal entry at the date of the bond purchase. (b) Prepare the journal entries to record the interest revenue and recognition of fair value for 2020. (c) Prepare the journal entry to record the recognition of fair value for 2021. (Round answers to 2 decimal places, e.g. 2,525.25. Credit account titles are automatically indented…
Attemptnrogress On January 1, 2025, Flounder Company purchased 8% bonds having a maturity value of $200,000 for $216,849.76. The bonds provide the bondholders with a 6% yield. They are dated January 1, 2025, and mature January 1, 2030, with interest received on January 1 of each year. Flounder Company uses the effective-interest method to allocate unamortized discount or premium. The bonds are classified in the held-to-maturity category. (a) Prepare the journal entry at the date of the bond purchase. (List debit entry before credit entry. 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 O for the amounts. Round answers to 2 decimal places, e.g. 1,225.25.) Date Account Titles and Explanation Jan. 1, 2025 eTextbook and Media List of Accounts Save for Later O Search 1 DOLL Debit Attempts: 0 of 3 used Credit Submit Answer
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On January 1, 2020, Aumont Company sold 12% bonds having a maturity value of $500,000 for $537,907.37, which provides the bondholders with a 10% yield. The bonds are dated January 1, 2020, and mature January 1, 2025, with interest payable December 31 of each year. Aumont Company allocates interest and unamortized discount or premium on the effective-interest basis. Instructions (Round answers to the nearest cent.) a. Prepare the journal entry at the date of the bond issuance. b. Prepare a schedule of interest expense and bond amortization for 2020–2022. c. Prepare the journal entry to record the interest payment and the amortization for 2020. d. Prepare the journal entry to record the interest payment and the amortization for 2022.
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