Prepare Garzon Company's journal entries to record the following transactions for the current year.January 1 Purchases 8.5% bonds (as a held-to-maturity investment) issued by PBS at a cost of $52,800, whichis the par value.June 30 Receives first semiannual payment of interest from PBS bonds.December 31 Receives a check from PBS in payment of principal ( $52,800) and the second semiannual payment ofinterest.View transaction listJournal entry worksheet12>Purchases 8.5% bonds (as a held-to-maturity investment) issued by PBS at acost of $52,800, which is the par value.Note: Enter debits before credits.DateGeneral JournalDebitCreditJanuary 01Record entryClear entryView general journal

A journal entry records a business transaction in the accounting system for an organization.

Answered: Prepare Garzon Company's journal…

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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Salt Foods purchases fifty $1,000, 5%, 10-year bonds issued by Pretzelmania, Inc., for $54,088 on January 1. The market interest rate for bonds of similar risk and maturity is 4%. Salt Foods receives interest semiannually on June 30 and December 31.1. & 2. Record the necessary entries regarding the bonds. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field. Round your answers to the nearest whole number.)
The following transactions were completed by Montague Inc., whose fiscal year is the calendar year: 20Y1 July 1. Issued $55,000,000 of 10-year, 9% callable bonds dated July 1, 20Y1, at a market (effective) rate of 7%, receiving cash of $62,817,040. Interest is payable semiannually on December 31 and June 30. Dec. 31. Paid the semiannual interest on the bonds. The bond discount amortization of $390,852 is combined with the semiannual interest payment. 20Y2 June 30. Paid the semiannual interest on the bonds. The bond discount amortization of $390,852 is combined with the semiannual interest payment. Dec. 31. Paid the semiannual interest on the bonds. The bond discount amortization of $390,852 is combined with the semiannual interest payment. 20Y3 June 30. Recorded the redemption of the bonds, which were called at 103. The balance in the bond premium account is $6,253,632 after payment of interest and amortization of premium have been recorded. (Record the…
Prepare Natura Company's journal entries to record the following transactions involving its short-term investments in held-to-maturity debt securities, all of which occurred during the current year. a. On June 15, paid $180,000 cash to purchase Remed's 90-day short-term debt securities ($180,000 principal), dated June 15, that pay 7% interest. b. On September 16, received a check from Remed in payment of the principal and 90 days' interest on the debt securities purchased in transaction a. Note: Use 360 days in a year. Do not round your intermediate calculations. View transaction list Journal entry worksheet < 1 2 On June 15, paid $180,000 cash to purchase Remed's 90-day short-term debt securities ($180,000 principal), dated June 15, that pay 7% interest. Note: Enter debits before credits. Transaction a. Record entry General Journal Clear entry Debit Credit View general journal
Assume that on July 1, Jerome, Incorporated, paid $100,000 to buy Potter's 8 percent, two-year bonds with a $ bonds pay interest semiannually on December 31 and June 30. Jerome intends to hold the bonds until they ma Complete the necessary December 31 entry to record receipt of interest by selecting the account names from and entering dollar amounts in the debit and credit columns. View transaction list Journal entry worksheet 1 Assume that on July 1, Jerome, Inc., paid $100,000 to buy Potter's 8 percent, two-year bonds with a $100,000 par value. The bonds pay interest semiannually on December 31 and June 30. Jerome intends to hold the bonds until they mature. Complete the necessary December 31 entry to record Note: Enter debits before credits. Date Dec. 31 General Journal Debit Credit
Assume that on July 1, Jerome, Inc., paid $100,000 to buy Potter's 8 percent, two-year bonds with a $100,000 par value. The bonds pay interest semiannually on December 31 and June 30. Jerome intends to hold the bonds until they mature. Complete the necessary December 31 entry to record receipt of interest by selecting the account names from the pull-down menus and entering dollar amounts in the debit and credit columns.
1.Prepare Hertog Company’s journal entries to record the following transactions for the current year. May 7 Purchases Kraft bonds as a short-term investment in trading securities at a cost of $10,830. June 6 Sells its entire investment in Kraft bonds for $11,330 cash
Smiley Corporation wholesales repair products to equipment manufacturers. On April 1, Year 1, Smiley issued $25,100,000 of five-year, 5% bonds at a market (effective) interest rate of 3%, receiving cash of $27,414,835. Interest is payable semiannually on April 1 and October 1. Required: a. Journalize the entries to record the following. Refer to the Chart of Accounts for exact wording of account titles. 1. Issuance of bonds on April 1, Year 1. 2. First interest payment on October 1, Year 1, and amortization of bond premium for six months, using the straight-line method. (Round to the nearest dollar.) b. Explain why the company was able to issue the bonds for $27,414,835 rather than for the face amount of $25,100,000. Chart of Accounts CHART OF ACCOUNTS Smiley Corporation General Ledger ASSETS 110 Cash 111 Petty Cash 121 Accounts Receivable 122 Allowance for Doubtful Accounts 126 Interest Receivable 127 Notes…
On Jan. 1, Year 1, Foxcroft Inc. issued 90 bonds with a face value of $1,060 for $99,400. The bonds had a stated rate of 5% and paid interest semiannually. What is the journal entry to record the first payment to the bondholders? If an amount box does not require an entry, leave it blank. Jun. 30 Interest Expense Interest Expense Cash Cash
Prepare Hertog Company's journal entries to record the following transactions for the current year. May 7 Purchases Kraft bonds as a short-term investment in trading securities at a cost of $10,990. June 6 Sells its entire investment in Kraft bonds for $11,510 cash. View transaction list Journal entry worksheet 1 2 Purchases Kraft bonds as a short-term investment in trading securities at a cost of $10,990. Note: Enter debits before credits. Date May 07 Record entry General Journal Clear entry Debit Credit View general journal >
Prepare Natura Co.’s journal entries to record the following transactions involving its short-term investments in held-to-maturity debt securities, all of which occurred during the current year. a. On June 15, paid $1,000 cash to purchase Remed’s 90-day short-term debt securities ($1,000 principal), dated June 15, that pay 10% interest. b. On September 16, received a check from Remed in payment of the principal and 90 days’ interest on the debt securities purchased in part a.
On May 1, Cedar Inc. purchases $150,000 of 10-year, Knox Corporation 8% bonds dated March 1 at 100 plus accrued interest. Required: Journalize the entry to record the semiannual receipt of interest on March 1, Year 2. Refer to the Chart of Accounts for exact wording of account titles.
Smiley Corporation wholesales repair products to equipment manufacturers. On April 1, Year 1, Smiley issued $24,200,000 of five-year, 11% bonds at a market (effective) interest rate of 9%, receiving cash of $26,114,936. Interest is payable semiannually on April 1 and October 1. Required: a. Journalize the entries to record the following. Refer to the Chart of Accounts for exact wording of account titles. 1. Issuance of bonds on April 1, Year 1. 2. First interest payment on October 1, Year 1, and amortization of bond premium for six months, using the straight-line method. (Round to the nearest dollar.) b. Explain why the company was able to issue the bonds for $26,114,936 rather than for the face amount of $24,200,000. Chart of Accounts CHART OF ACCOUNTS Smiley Corporation General Ledger ASSETS 110 Cash 111 Petty Cash 121 Accounts Receivable 122 Allowance for Doubtful Accounts 126 Interest Receivable 127 Notes…

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