Bond investment: Bond investments are debt securities which pay a fixed interest revenue to the investor. Journal entry : Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically. Debit and credit rules: Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts. Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts. To journalize: The bond investment transactions of H Trust

Question

General accounting question

Answer 1

Question

Chapter 15, Problem 15.1APE

(a)

To determine

Bond investment: Bond investments are debt securities which pay a fixed interest revenue to the investor.

Journal entry: Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically.

Debit and credit rules:

Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts.

Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.

To journalize: The bond investment transactions of H Trust

(b)

To determine

To journalize: Prepare journal entry to record the interest revenue received.

(c)

To determine

To journalize: Prepare journal entry for $120,000 bonds of M City sold at 98%, with an accrued interest of $600.

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Answer 2

Question

Chapter 15, Problem 15.1APE

(a)

To determine

Bond investment: Bond investments are debt securities which pay a fixed interest revenue to the investor.

Journal entry: Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically.

Debit and credit rules:

Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts.

Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.

To journalize: The bond investment transactions of H Trust

(b)

To determine

To journalize: Prepare journal entry to record the interest revenue received.

(c)

To determine

To journalize: Prepare journal entry for $120,000 bonds of M City sold at 98%, with an accrued interest of $600.

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Answer 3

Question

Chapter 15, Problem 15.1APE

(a)

To determine

Bond investment: Bond investments are debt securities which pay a fixed interest revenue to the investor.

Journal entry: Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically.

Debit and credit rules:

Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts.

Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.

To journalize: The bond investment transactions of H Trust

(b)

To determine

To journalize: Prepare journal entry to record the interest revenue received.

(c)

To determine

To journalize: Prepare journal entry for $120,000 bonds of M City sold at 98%, with an accrued interest of $600.

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Answer 4

Question

Chapter 15, Problem 15.1APE

(a)

To determine

Bond investment: Bond investments are debt securities which pay a fixed interest revenue to the investor.

Journal entry: Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically.

Debit and credit rules:

Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts.

Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.

To journalize: The bond investment transactions of H Trust

(b)

To determine

To journalize: Prepare journal entry to record the interest revenue received.

(c)

To determine

To journalize: Prepare journal entry for $120,000 bonds of M City sold at 98%, with an accrued interest of $600.

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Answer 5

Chapter 15, Problem 15.1APE

(a)

To determine

Bond investment: Bond investments are debt securities which pay a fixed interest revenue to the investor.

Journal entry: Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically.

Debit and credit rules:

Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts.

Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.

To journalize: The bond investment transactions of H Trust

(b)

To determine

To journalize: Prepare journal entry to record the interest revenue received.

(c)

To determine

To journalize: Prepare journal entry for $120,000 bonds of M City sold at 98%, with an accrued interest of $600.

Answer 6

Chapter 15, Problem 15.1APE

(a)

To determine

Bond investment: Bond investments are debt securities which pay a fixed interest revenue to the investor.

Journal entry: Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically.

Debit and credit rules:

Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts.

Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.

To journalize: The bond investment transactions of H Trust

Answer 7

Chapter 15, Problem 15.1APE

(a)

To determine

Bond investment: Bond investments are debt securities which pay a fixed interest revenue to the investor.

Journal entry: Journal entry is a set of economic events which can be measured in monetary terms. These are recorded chronologically and systematically.

Debit and credit rules:

Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in stockholders’ equity accounts.

Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.

To journalize: The bond investment transactions of H Trust

Answer 8

(b)

To determine

To journalize: Prepare journal entry to record the interest revenue received.

Answer 9

(b)

To determine

To journalize: Prepare journal entry to record the interest revenue received.

Answer 10

(c)

To determine

To journalize: Prepare journal entry for $120,000 bonds of M City sold at 98%, with an accrued interest of $600.

Answer 11

(c)

To determine

To journalize: Prepare journal entry for $120,000 bonds of M City sold at 98%, with an accrued interest of $600.

Answer 12

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Answer 13

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Answer 23

Ch. 15 - Why might a business invest cash in temporary...Ch. 15 - What causes a gain or loss on the sale of a bond...Ch. 15 - When is the equity method the appropriate...Ch. 15 - How does the accounting for a dividend received...Ch. 15 - Prob. 5DQ Ch. 15 - What is the major difference in the accounting for...Ch. 15 - Prob. 7DQ Ch. 15 - How would a debit balance in Unrealized Gain...Ch. 15 - What are the factors contributing to the trend...Ch. 15 - Prob. 10DQ

Solution Summary: The author explains that bond investments pay fixed interest revenue to the investor. Journal entry is a set of economic events which can be measured in monetary terms.

To journalize: Prepare journal entry to record the interest revenue received.

To journalize: Prepare journal entry for $120,000 bonds of M City sold at 98%, with an accrued interest of $600.

Chapter 15 Solutions