Homework Answers
Solution:
Journal Entries
| S.No | Particulars | Debit ($) | Credit ($) |
| a. | Held-to-maturity securities | $60,314 | |
| cash | $60,314 | ||
| b. | cash(65,000*10%) | $6,500 | |
| held-to-maturity securities | $738 | ||
| Interest revenue(60,314*12%) | $7,238 |
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Brief Exercise 17-1 Skysong Company purchased, on January 1, 2017, as a held-to-maturity investment, $65,000 of...
Brief Exercise 17-1 Monty Company purchased, on January 1, 2017, as a held-to-maturity investment, $85,000 of...
Brief Exercise 17-1 Monty Company purchased, on January 1, 2017, as a held-to-maturity investment, $85,000 of the 10%, 5- year bonds of Chester Corporation for $78,873, which provides an 12% return. Prepare Monty's journal entries for (a) the purchase of the investment, and (b) the receipt of annual interest and discount amortization. Assume effective-interest amortization is used. (Round answers to 0 decimal places, e.g. 1,225. Credit account titles are automatically indented when amount is entered. Do not indent manually. If...
Carla Company purchased, on January 1, 2017, as a held-to-maturity investment, $66,000 of the 8%, 5-year...
Carla Company purchased, on January 1, 2017, as a
held-to-maturity investment, $66,000 of the 8%, 5-year bonds of
Chester Corporation for $60,996, which provides an 10%
return.
Prepare Carla’s journal entries for (a) the purchase of the
investment, and (b) the receipt of annual interest and discount
amortization. Assume effective-interest amortization is used.
(Round answers to 0 decimal places, e.g. 1,225. Credit
account titles are automatically indented when amount is entered.
Do not indent manually. If no entry is required,...
Question 11 Wildhorse Company purchased, on January 1, 2017, as a held-to-maturity investment, $68,000 of the...
Question 11 Wildhorse Company purchased, on January 1, 2017, as a held-to-maturity investment, $68,000 of the 10%, 5-year bonds of Chester Corporation for $63,098, which provides an 12% return. Prepare Wildhorse's journal entries for (a) the purchase of the investment, and (b) the receipt of annual interest and discount amortization. Assume effective-interest amortization is used. (Round answers to 0 decimal places, e.g. 1,225. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry...
CALORADOR PRINR VRSON Brief Exercise 17-1 DACK NEXT Stellar Company purchased, on January 1, 2017, as...
CALORADOR PRINR VRSON Brief Exercise 17-1 DACK NEXT Stellar Company purchased, on January 1, 2017, as a held-to-maturity investment, $73,000 of the t, S-year bonds of Chester Corporation for $67,465, which provides an 10% retum Prepare Stelar's journal entries for (a) the purchase of the investment, and (b) the receipt of annual interest and discount amartization. Assume effective-interest amertization is used. (Round answers to o decmal places, eg. 1,225. Credit account titles are automatically indented when amount is entered. Do...
Brief Exercise 17-2 Culver Company purchased, on January 1, 2017, as an available-for-sale security, $74,000 of...
Brief Exercise 17-2 Culver Company purchased, on January 1, 2017, as an available-for-sale security, $74,000 of the 1196, 5-year bonds of Chester Corporation for $68,794, which provides an 13% Prepare Culver's journal entries for (a) the purchase of the investment, (b) the receipt of annual interest and discount amortization, and (c) the year-end fair value adjustment. (Assume a zero balance in the Fair Value Adjustment account.) The bonds have a year-end fair value of $70,300. (Round answers to 0 decimal...
Sheridan Corporation purchased on January 1, 2020, as a held-to-maturity investment, $52,000 of the 7%, 5-year...
Sheridan Corporation purchased on January 1, 2020, as a held-to-maturity investment, $52,000 of the 7%, 5-year bonds of Harrison, Inc. for $56,551, which provides a 5% return. The bonds pay interest semiannually. Prepare Sheridan's journal entries for (a) the purchase of the investment, and (b) the receipt of semiannual interest and premium amortization. Assume effective- interest amortization is used. (Round answers to 0 decimal places, e.g. 5,125. Credit account titles are automatically indented when amount is entered. Do not indent...
Larkspur Corporation purchased, as a held-to-maturity investment, $55,000 of the 8%, 4-year bonds of Harns Inc....
Larkspur Corporation purchased, as a held-to-maturity investment, $55,000 of the 8%, 4-year bonds of Harns Inc. for $58,861, which provides a 6% return. The bonds pay interest semiannually. Prepare Larkspur's journal entries for (a) the purchase of the investment, and (b) the receipt of semiannual interest and premium amortization. Assume effective-interest amortization is used. (Round answers to O decimal places, e.g. 5,125. Credit account titles are automatically indented when amount is entered. De not indent manually. If no entry is...
Exercise 17-3 On January 1, 2017, Bonita Company purchased 9% bonds having a maturity value of...
Exercise 17-3 On January 1, 2017, Bonita Company purchased 9% bonds having a maturity value of $200,000, for $303,599.66. The bonds provide the bondholders with a 6% yield. They are dated January 1, 2017, and mature January 1, 2022, with interest receivable January 1 of each year. Bonita Company uses the effective interest method to allocate uramortized discount or premium. The bonds are dassified in the held-to-returity category. Prepare the journal entry at the date of the bond purchase. (Enter...
*Exercise 17-03 On January 1, 2020, Carla Company purchased 8% bonds having a maturity value of...
*Exercise 17-03 On January 1, 2020, Carla Company purchased 8% bonds having a maturity value of $400,000, for $433,699.52. The bonds provide the bondholders with a 6% yield. They are dated January 1, 2020, and mature January 1, 2025, with interest received on January 1 of each year. Carla Company uses the effective-interest method to allocate unamortized discount or premium. The bonds are classified in the held-to-maturity category. Prepare the journal entry at the date of the bond purchase. (Enter...
Exercise 17-03 On January 1, 2020, Hi and Lois Company purchased 12% bonds having a maturity...
Exercise 17-03 On January 1, 2020, Hi and Lois Company purchased 12% bonds having a maturity value of $300,000, for $322,744.44. The bonds provide the bondholders with a 10% yield. They are dated January 1, 2020, and mature January 1, 2025, with interest received on January 1 of each year. Hi and Lois Company uses the effective-interest method to allocate unamortized discount or premium. The bonds are classified in the held-to-maturity category. Prepare the journal entry at the date of...
Brief Exercise 17-1 Monty Company purchased, on January 1, 2017, as a held-to-maturity investment, $85,000 of the 10%, 5- year bonds of Chester Corporation for $78,873, which provides an 12% return. Prepare Monty's journal entries for (a) the purchase of the investment, and (b) the receipt of annual interest and discount amortization. Assume effective-interest amortization is used. (Round answers to 0 decimal places, e.g. 1,225. Credit account titles are automatically indented when amount is entered. Do not indent manually. If...
Carla Company purchased, on January 1, 2017, as a
held-to-maturity investment, $66,000 of the 8%, 5-year bonds of
Chester Corporation for $60,996, which provides an 10%
return.
Prepare Carla’s journal entries for (a) the purchase of the
investment, and (b) the receipt of annual interest and discount
amortization. Assume effective-interest amortization is used.
(Round answers to 0 decimal places, e.g. 1,225. Credit
account titles are automatically indented when amount is entered.
Do not indent manually. If no entry is required,...
Question 11 Wildhorse Company purchased, on January 1, 2017, as a held-to-maturity investment, $68,000 of the 10%, 5-year bonds of Chester Corporation for $63,098, which provides an 12% return. Prepare Wildhorse's journal entries for (a) the purchase of the investment, and (b) the receipt of annual interest and discount amortization. Assume effective-interest amortization is used. (Round answers to 0 decimal places, e.g. 1,225. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry...
CALORADOR PRINR VRSON Brief Exercise 17-1 DACK NEXT Stellar Company purchased, on January 1, 2017, as a held-to-maturity investment, $73,000 of the t, S-year bonds of Chester Corporation for $67,465, which provides an 10% retum Prepare Stelar's journal entries for (a) the purchase of the investment, and (b) the receipt of annual interest and discount amartization. Assume effective-interest amertization is used. (Round answers to o decmal places, eg. 1,225. Credit account titles are automatically indented when amount is entered. Do...
Brief Exercise 17-2 Culver Company purchased, on January 1, 2017, as an available-for-sale security, $74,000 of the 1196, 5-year bonds of Chester Corporation for $68,794, which provides an 13% Prepare Culver's journal entries for (a) the purchase of the investment, (b) the receipt of annual interest and discount amortization, and (c) the year-end fair value adjustment. (Assume a zero balance in the Fair Value Adjustment account.) The bonds have a year-end fair value of $70,300. (Round answers to 0 decimal...
Sheridan Corporation purchased on January 1, 2020, as a held-to-maturity investment, $52,000 of the 7%, 5-year bonds of Harrison, Inc. for $56,551, which provides a 5% return. The bonds pay interest semiannually. Prepare Sheridan's journal entries for (a) the purchase of the investment, and (b) the receipt of semiannual interest and premium amortization. Assume effective- interest amortization is used. (Round answers to 0 decimal places, e.g. 5,125. Credit account titles are automatically indented when amount is entered. Do not indent...
Larkspur Corporation purchased, as a held-to-maturity investment, $55,000 of the 8%, 4-year bonds of Harns Inc. for $58,861, which provides a 6% return. The bonds pay interest semiannually. Prepare Larkspur's journal entries for (a) the purchase of the investment, and (b) the receipt of semiannual interest and premium amortization. Assume effective-interest amortization is used. (Round answers to O decimal places, e.g. 5,125. Credit account titles are automatically indented when amount is entered. De not indent manually. If no entry is...
Exercise 17-3 On January 1, 2017, Bonita Company purchased 9% bonds having a maturity value of $200,000, for $303,599.66. The bonds provide the bondholders with a 6% yield. They are dated January 1, 2017, and mature January 1, 2022, with interest receivable January 1 of each year. Bonita Company uses the effective interest method to allocate uramortized discount or premium. The bonds are dassified in the held-to-returity category. Prepare the journal entry at the date of the bond purchase. (Enter...
*Exercise 17-03 On January 1, 2020, Carla Company purchased 8% bonds having a maturity value of $400,000, for $433,699.52. The bonds provide the bondholders with a 6% yield. They are dated January 1, 2020, and mature January 1, 2025, with interest received on January 1 of each year. Carla Company uses the effective-interest method to allocate unamortized discount or premium. The bonds are classified in the held-to-maturity category. Prepare the journal entry at the date of the bond purchase. (Enter...
Exercise 17-03 On January 1, 2020, Hi and Lois Company purchased 12% bonds having a maturity value of $300,000, for $322,744.44. The bonds provide the bondholders with a 10% yield. They are dated January 1, 2020, and mature January 1, 2025, with interest received on January 1 of each year. Hi and Lois Company uses the effective-interest method to allocate unamortized discount or premium. The bonds are classified in the held-to-maturity category. Prepare the journal entry at the date of...
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