On January 1, 2023, Concord Limited paid $415,744 for 10% bonds with a maturity value of $385,000. The bonds provide thebondholders with a 8% yield. They are dated January 1, 2023, and mature on January 1, 2028, with interest receivable on December31 of each year. Concord accounts for the bonds using the amortized cost approach, applies ASPE using the effective interestmethod, and has a December 31 year end. Prepare the journal entry to record interest received and interest income for 2023.

On January 1, 2023, Concord Limited paid $415,744 for 10% bonds with a maturity value of $385,000. The bonds provide thebondholders with a 8% yield. They are dated January 1, 2023, and mature on January 1, 2028, with interest receivable on December31 of each year. Concord accounts for the bonds using the amortized cost approach, applies ASPE using the effective interestmethod, and has a December 31 year end. Prepare the journal entry to record interest received and interest income for 2023.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 4EA: On January 1, 2018, Wawatosa Inc. issued 5-year bonds with a face value of $200,000 and a stated...

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On January 1, 2018, Wawatosa Inc. issued 5-year bonds with a face value of $200,000 and a stated interest rate of 12% payable semi-annually on July 1 and January 1. The bonds were sold to yield 10%. Assuming the bonds were sold at 107.732, what is the selling price of the bonds? Were they issued at a discount or a premium?
Chung Inc. issued $50,000 of 3-year bonds on January 1, 2018, with a stated rate of 4% and a market rate of 4%. The bonds paid interest semi-annually on June 30 and Dec. 31. How much money did the company receive when the bonds were issued? The bonds would be quoted at what rate?
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On January 1, 2022, Bramble and Lois Company purchased 12% bonds having a maturity value of $234,000 for $251,740.88. The bonds provide the bondholders with a 10% yield. They are dated January 1, 2022, and mature on January 1, 2027, with interest receivable on December 31 of each year. Bramble and Lois Company uses the effective interest method to allocate unamortized discount or premium. The bonds are carried at FV-OCI. The fair value of the bonds at December 31 of each year-end is as follows: 2022 $250,000 $241,000 2023 Your answer is partially correct. Prepare the journal entries to record the recognition of fair value for 2023 and assuming the investment is sold for $241,000 on December 31, 2023, reclassifying any accumulated holding gains or losses to net income. (Credit account titles are automatically indented when the 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. List all debit entries…