X8. The bonds were purchased at 100 plus accrued interest. Interest is paid semi-annually on 30 June and 31 December. Yellow Company classifies this investment as vestment based on its investment objectives. repare the journal entries on the following dates: November 20X3 December 20X3 December 20X8 epare the journal entry to record the purchase of bonds 1 November 20X3: epare the journal entry to record receipt of coupon on 31 December 20X3: epare the journal entry to record the investment at maturity on 31 December 20X8 epare the journal entry required assuming that Orange company sold the bonds on 31 March 20X4 at 104 plus accrued interest. Orange paid $600 in transaction fees omplete the sale. epare the journal entry to record the sale of the bonds on 31 March 20X4:
X8. The bonds were purchased at 100 plus accrued interest. Interest is paid semi-annually on 30 June and 31 December. Yellow Company classifies this investment as vestment based on its investment objectives. repare the journal entries on the following dates: November 20X3 December 20X3 December 20X8 epare the journal entry to record the purchase of bonds 1 November 20X3: epare the journal entry to record receipt of coupon on 31 December 20X3: epare the journal entry to record the investment at maturity on 31 December 20X8 epare the journal entry required assuming that Orange company sold the bonds on 31 March 20X4 at 104 plus accrued interest. Orange paid $600 in transaction fees omplete the sale. epare the journal entry to record the sale of the bonds on 31 March 20X4:
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:On 1 November 20X3, Orange Company purchases bonds with a face value of $400,000 from Yellow Company. The bonds have an 6% coupon and mature on 31 December
20X8. The bonds were purchased at 100 plus accrued interest. Interest is paid semi-annually on 30 June and 31 December. Yellow Company classifies this investment as an AC
investment based on its investment objectives.
Prepare the journal entries on the following dates:
1 November 20X3
31 December 20X3
31 December 20X8
Prepare the journal entry to record the purchase of bonds 1 November 20X3:
Prepare the journal entry to record receipt of coupon on 31 December 20X3:
Prepare the journal entry to record the investment at maturity on 31 December 20X8
Prepare the journal entry required assuming that Orange company sold the bonds on 31 March 20X4 at 104 plus accrued interest. Orange paid $600 in transaction fees to
complete the sale.
Prepare the journal entry to record the sale of the bonds on 31 March 20X4:
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