On July 1, 2023, Riverbed Aggregates Ltd. purchased 6% bonds with a maturity value of $125,000 for $129,482. The bonds providethe bondholders with a 5% yield. The bonds mature four years later, on July 1, 2027, with interest receivable June 30 and December31 of each year. Riverbed uses the effective interest method to allocate unamortized discount or premium. The bonds are accountedfor using the FV-OCI model with recycling. Riverbed has a calendar year end. The fair value of the bonds at December 31, 2023 and2024, was $129,173 and $127,762, respectively. Assume fair value adjustments are recorded at year end only. Immediately aftercollecting interest on December 31, 2024, the bonds were sold for $127.762.(a)Prepare the journal entry at the date of the bond purchase. (Credit account titles are automatically indented when the amount isentered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List debit entrybefore credit entry. Round answers to O decimal places, e.g. 5,275.)

A journal entry is a basic accounting record that is used to chronologically track financial…

On July 1, 2023, Riverbed Aggregates Ltd. purchased 6% bonds with a maturity value of $125,000 for $129,482. The ba the bondholders with a 5% yield. The bonds mature four years later, on July 1, 2027, with interest receivable June 30 an 31 of each year. Riverbed uses the effective interest method to allocate unamortized discount or premium. The bonds am for using the FV-OCI model with recycling, Riverbed has a calendar year end. The fair value of the bonds at December 3: 2024, was $129,173 and $127,762, respectively. Assume fair value adjustments are recorded at year end only. Immedia collecting interest on December 31 3034 1

On July 1, 2023, Riverbed Aggregates Ltd. purchased 6% bonds with a maturity value of $125,000 for $129,482. The ba the bondholders with a 5% yield. The bonds mature four years later, on July 1, 2027, with interest receivable June 30 an 31 of each year. Riverbed uses the effective interest method to allocate unamortized discount or premium. The bonds am for using the FV-OCI model with recycling, Riverbed has a calendar year end. The fair value of the bonds at December 3: 2024, was $129,173 and $127,762, respectively. Assume fair value adjustments are recorded at year end only. Immedia collecting interest on December 31 3034 1

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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