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On July 1, 2023, Riverbed Aggregates Ltd, purchased 6% bonds with a maturity value of $125,000 for $129,482. The bonds provide the bondholders with a 5% yield. The bonds mature four years later, on July 1, 2027, with interest receivable June 30 and December 31 of each year. Riverbed uses the effective interest method to allocate unamortized discount or premium. The bonds are t accounted for using the FV-OCI model with recycling. Riverbed has a calendar year end. The fair value of the bonds at December 31, 2023 and 2024, was $129,173 and $127.762, respectively Assume fair value adjustments are recorded at year end only. Immediately after collecting interest on December 31, 2024, the bonds were sold for $127,762

On July 1, 2023, Riverbed Aggregates Ltd, purchased 6% bonds with a maturity value of $125,000 for $129,482. The bonds provide the bondholders with a 5% yield. The bonds mature four years later, on July 1, 2027, with interest receivable June 30 and December 31 of each year. Riverbed uses the effective interest method to allocate unamortized discount or premium. The bonds are t accounted for using the FV-OCI model with recycling. Riverbed has a calendar year end. The fair value of the bonds at December 31, 2023 and 2024, was $129,173 and $127.762, respectively Assume fair value adjustments are recorded at year end only. Immediately after collecting interest on December 31, 2024, the bonds were sold for $127,762

FINANCIAL ACCOUNTING
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 July 1, 2023, Riverbed Aggregates Ltd, purchased 6% bonds with a maturity value of $125,000 for $129,482. The bonds provide the bondholders with a 5% yield. The bonds mature four years later, on July 1, 2027, with interest receivable June 30 and December 31 of each year. Riverbed uses the effective interest method to allocate unamortized discount or premiums. The bonds are accounted for using the FV-OCI model with recycling, Riverbed has a calendar year end. The fair value of the bonds at December 31, 2023 and 2024, was $129,173 and $127.762, respectively Assume fair value adjustments are recorded at year end only. Immediately after collecting interest on December 31, 2024, the bonds were sold for $127,762.
Transcribed Image Text:On July 1, 2023, Riverbed Aggregates Ltd, purchased 6% bonds with a maturity value of $125,000 for $129,482. The bonds provide the bondholders with a 5% yield. The bonds mature four years later, on July 1, 2027, with interest receivable June 30 and December 31 of each year. Riverbed uses the effective interest method to allocate unamortized discount or premiums. The bonds are accounted for using the FV-OCI model with recycling, Riverbed has a calendar year end. The fair value of the bonds at December 31, 2023 and 2024, was $129,173 and $127.762, respectively Assume fair value adjustments are recorded at year end only. Immediately after collecting interest on December 31, 2024, the bonds were sold for $127,762.
Prepare a bond amortization schedule to December 31, 2024. (Round answers to 0 decimal places, eg. 5,275.) Schedule of Interest Revenue and Bond Premium Amortization Effective-Interest Method Interest Revenue Date July 1, 2023 Dec.31.2023 June 30, 2024 Dec 31, 2024 $ Cash Received Premium Amortized Amortized Cost of Bonds S 129,482
Transcribed Image Text:Prepare a bond amortization schedule to December 31, 2024. (Round answers to 0 decimal places, eg. 5,275.) Schedule of Interest Revenue and Bond Premium Amortization Effective-Interest Method Interest Revenue Date July 1, 2023 Dec.31.2023 June 30, 2024 Dec 31, 2024 $ Cash Received Premium Amortized Amortized Cost of Bonds S 129,482
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