On January 1, Year 1, Narito Company purchased a P100,000 face value 5-year bond of Wolf Corporation for P108,600, a price that yields 5% on a stated interest rate of 7%. Interest is payable annually at December 31. The bonds investment is measured at amortized cost. Required: Give all the entries in the books of Narito Company for years 1 through years 3 as a result of foregoing.

Q: On January 1, 2021, Kaye Ltd. purchased $250,000 of Danford Co.'s 4%, 8-year bonds.  The market rate…

A: Under Effective Interest Rate Method , Interest Income/Expense will be recognized at Market Rate.

Q: Trog Industries pays and records the semiannual interest on its $520,000, 10-year, 6% bonds…

A: Here in this question, we are required to make journal entry for interest payment and discount…

Q: On

A:

Q: AAA Inc. purchased P400,000 of BBB Corp. ten-year bonds with a stated interest rate of 8 percent…

A: GIVEN   AAA Inc. purchased $400,000 of BBB Corp. ten-year bonds with a stated interest rate of 8%…

Q: "Ace Company issued P100,000 face of 6%, 10 year-bonds, with interest payable semi-annually. Ace…

A: Account Titles and Explanation  Debit   Credit  Interest Expense                3,250   Discount…

Q: On January 1 of the current year, Barton Corporation issued 11%, 5-year bonds with a face value of…

A: The objective of this question is to calculate the bond interest expense for the current year ended…

Q: quired: Complete the five empty spaces in the amortization schedule below.

A: Step 1 In Bond Amortization, Interest recognized as an expenses with effective interest rate  and…

Q: On January 1, Year 1 Navara Company purchased P100,000 face value 5-year bond of Wolf Corp for…

A: SOLUTION  A JOURNAL IS A COMPANY'S OFFICIAL BOOK IN WHICH ALL BUSINESS TRANSACTIONS ARE RECORDED IN…

Q: On January 1, 2021, BEZOS COMPANY acquired 10%, 3-year bonds with face value of $ 2,000,000.…

A: Equity instruments: fair value through profit or loss (FVPL): Assets (FVPL) are recorded at fair…

Q: On January 1, Year 1, Hanover Corporation issued bonds with a $56,500 face value, a stated rate of…

A: Bonds Payable: Bonds Payable is an long term debt issued by the government and company's to raised…

Q: On April 1, 2XX6, a company bought a 10-year, 8% P 400,000 bonds for P 350,000, a price which will…

A: Bonds :— It is one of the source of capital that pays fixed periodic interest and face value amount…

Q: Braburt Co. issued $700,000 worth of six-year, five percent bonds on January 1st, 2021. Interest is…

A: A bond is a document of the bond issuer's obligation to the bondholders. Municipal bonds and bond…

Q: n January 1, 2020, Ehrlich Corporation issued 7%, 15-year bonds with a face amount of $900,000 at…

A: The bonds are the financial instruments that are issued to raise money from the market or investors.…

Q: On January 1, Year 1, Victor Company issued bonds with a $875,000 face value, a stated rate of…

A: Lets understand the basics. When bond is issued at less than the face value of bond then bond is…

Q: Gonzales Company acquired a P5,000,000, 5-year bond on January 1, 2020, for P4,620,000. The stated…

A: It is the loss arises, when the recoverable or realizable value from the asset is lower than the…

Q: RHODHA Corporation was authorized to issue P3,000,000 of 12% face value bonds on April 1. 2011.…

A: Under straight-line amortization, the discount or premium on the issue of a bond is amortized…

Q: Lakeshore Gelato issued $1,200,000 of 7% bonds at 99 on January 2, Year 1. Interest is paid…

A: Answer:- Bond is an instrument that carries fixed coupon payment with it. These are issued to those…

Q: 2.On January 1, Year 1 Naruto Company purchased P100,000 face value 5 year bond of Wolf Corp for…

A:

Q: Moab Corporation sells $600,000 of 7%, 20-year bonds for 98 on January 1. Interest is paid on…

A: Issue value = Face value of bonds x Issue price /100 = $600000 x 98/100 = $588,000

Q: On January 1, Year 1, Company C purchased 10 of the $10,000 face value, 10%, 2-year bonds of Company…

A: “Since you have posted a question with multiple sub parts, we will provide the solution only to the…

Q: On January 1, current year, Kaiser Permanente issued $2,000,000 of 8% bonds at par. These bonds are…

A: Since the bonds are issued at par, the market rate of interest and stated rate of interest will be…

Q: On July 1 of Year 1, West Company purchased for cash, 8, $10,000 bonds of North Corporation to yield…

A: When a bond is purchased at a discount then, the interest income is more than the stated interest as…

Q: On January 1, Sharp Company purchased $90,000 of Sox Company 5% bonds, at a time when the market…

A: A journal entry is being used to record a business arrangement in a corporation's accounting…

Q: On December 31, Caper, Inc., issued $500,000 of 8%, 9-year bonds for $440,000, yielding an effective…

A: The bond discount is amortized and the carrying value is increased over the bond tenure. The amount…

Q: On October 1, Qilan Ltd. purchased 7% bonds with a face value of $1,000 for trading purposes,…

A: As you have asked multiple sub-parts we can solve only first three sub-parts for you please repost…

Q: On July 1, 2023, DDJ Limited issued bonds with a face value of $900,000 due in 20 years, paying…

A: Bonds are issued below the face value than this is dicount and this is due to the higher interest in…

Q: b. Record the entry for the purchase of the bonds by West Company on July 1. Date Account Name…

A:

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: A company paid $600,000 for 1-year, 10% bonds with a par value of $600,000 on July 1. The bonds pay…

A: A record is typically kept in the ledger accounts, but it can also be kept in a specific account,…

Q: Journal entry to record the second period of interest, June 30,  Matrix would record a credit to…

A: Given information is: On January 1, 2019, Matrix, Inc. purchased as an investment OMR 22,000, of 9%,…

Q: On the first day of the fiscal year, a company issues a $888,000, 6%, 10-year bond that pays…

A:

Q: On February 1, 2019 PT CORONA purchased PT Sehati bonds (nominal value of Rp. 15,000,000, interest…

A: The following journal entries are to be recorded to amortize the discount on bonds as on 31…

Q: Best Beans Coffee Company issued bonds with a $270,000 face value on January 1, Year 1. The bonds…

A: The bonds are financial instruments that are issued to raise money from the investors. The bonds are…

Q: 7)  ABC Company purchased $1,200,000 of 7%, 5-year bonds from XYZ, Inc. on January 1, 2021, with…

A: Bond is that debt instrument which is used by the organisation to finance its long term fund needs,…

Q: Ellis Company issues 6.5%, five-year bonds dated January 1, 2021, with a $250,000 par value. The…

A: Bonds: Bond is a debt security.The amount of interest is paid on bond.  Bond amortization:…

Q: On June 30, Jamison Company issued $2,500,000 of 10-year, 9% bonds, dated June 30, for $2,580,000.…

A: Given: Value of the bond = $ 2,500,000 Bond rate = 9 % Price of the bond = $ 2,580,000

Q: On January 1, Year 1, Narito Company purchased P100,000 face value 5-year bond of Wolf Corporation…

A: Impairment Loss Impairment can happen as a consequence of one-time or unique occurrences, such as a…

Q: On January 1, 2020, Ehrlich Corporation issued 7%, 15-year bonds with a face amount of $5,000,000 .…

A: The bonds are the financial instruments that are issued to raise money from the market or investors.…

Q: On January 1, year 15, Hart, Inc. redeemed its 15-year bonds of $500,000 par value for 102. They…

A: Bonds payable refers to a type of long-term debt that a company or organization issues to borrow…

Q: Wildhorse Company purchased bonds with a face amount of $1225000 between interest payment dates.…

A: Bonds- A long-term debt under which a sum of money lends at a predetermined rate of interest, for a…

Q: January 1, Year 1, Twain Corporation sold $620,000 of its own 5 percent, 10-year bonds. Interest is…

A: Bond is financial instrument which is used to raise funds for financial obligations. It can be…

Q: On January 1, Year 1, Gibson Corporation purchased bonds issued by Williamson Company. These bonds…

A: The objective of the question is to calculate the interest revenue that Gibson Corporation should…

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.