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Question 1 Prepare the journal entry to record the receipt of interest on July 1 Question 2 Prepare any required adjusting journal entry at October 31

Question 1 Prepare the journal entry to record the receipt of interest on July 1 Question 2 Prepare any required adjusting journal entry at October 31

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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Question 1 Prepare the journal entry to record the receipt of interest on July 1 Question 2 Prepare any required adjusting journal entry at October 31
On January 1, 2024, Crane Ltd., a public company, purchased $594,000 of 5-year, 6% bonds at par from Pronghorn Corporation. Interest is received semi-annually on July 1 and January 1. Crane purchased the bonds to earn interest. At December 31, 2024, the bonds were trading at 104. (a)
Transcribed Image Text:On January 1, 2024, Crane Ltd., a public company, purchased $594,000 of 5-year, 6% bonds at par from Pronghorn Corporation. Interest is received semi-annually on July 1 and January 1. Crane purchased the bonds to earn interest. At December 31, 2024, the bonds were trading at 104. (a)
Novak Corporation, during the year ended October 31, 2024, had the following transactions for money-market instruments purchased to earn interest: Jan. 2 Purchased a 110-day, $38,800 treasury bill maturing on May 1 for $38,567. May Aug. 1 Aug. 31 Sept. 30 1 Oct. 1 Oct. 15 The treasury bill matured. Invested $63,100 in a money-maret fund. Received notification that $158 of interest had been earned and added to the fund. Received notification that $158 of interest had been earned and added to the fund. Purchased a 90-day, 3.10%, $29,100 treasury bill for $28,876. Cashed the money-market fund and received $63,495.
Transcribed Image Text:Novak Corporation, during the year ended October 31, 2024, had the following transactions for money-market instruments purchased to earn interest: Jan. 2 Purchased a 110-day, $38,800 treasury bill maturing on May 1 for $38,567. May Aug. 1 Aug. 31 Sept. 30 1 Oct. 1 Oct. 15 The treasury bill matured. Invested $63,100 in a money-maret fund. Received notification that $158 of interest had been earned and added to the fund. Received notification that $158 of interest had been earned and added to the fund. Purchased a 90-day, 3.10%, $29,100 treasury bill for $28,876. Cashed the money-market fund and received $63,495.
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