A) | 12/31/2015 | Investments in Bonds | Dr | $ 124,287.00 | |
To Bank Account | Cr | $ 124,287.00 | |||
(being bond purchased of $110,000 5 year bond with 5% yield at value of $124,287) | |||||
B) | 12/31/2016 | Bank Account | Dr | $ 8,800.00 | |
To Interest Income | Cr | $ 6,214.00 | |||
To Investment in Bonds | Cr | $ 2,586.00 | |||
(To record receipt of Interest and premium amortisation) | |||||
C) | 12/31/2018 | Bank Account | Dr | $ 8,800.00 | |
To Interest Income | Cr | $ 5,949.00 | |||
To Investment in Bonds | Cr | $ 2,851.00 | |||
(To record receipt of Interest and premium amortisation) | |||||
d) | 12/31/2015 | Available for Sale Investment | Dr | $ 124,287.00 | |
To Bank Account | Cr | $ 124,287.00 | |||
(being bond purchased of $110,000 5 year bond with 5% yield at value of $124,287) | |||||
E-1) | 12/31/2016 | Bank Account | Dr | $ 8,800.00 | |
To Interest Income | Cr | $ 6,214.00 | |||
To Available for Sale Investment | Cr | $ 2,586.00 | |||
(To record receipt of Interest and premium amortisation) | |||||
E-2) | 12/31/2016 | Loss on Available for Sale Investment | Dr | $ 601.00 | |
To Available for Sale Investment | Cr | $ 601.00 | |||
(Being the loss in Fair value and amortised cost charged to Other Comprehensive income | |||||
F-1) | 12/31/2018 | Bank Account | Dr | $ 8,800.00 | |
To Interest Income | Cr | $ 5,949.00 | |||
To Available for Sale Investment | Cr | $ 2,851.00 | |||
(To record receipt of Interest and premium amortisation) | |||||
F-2) | 12/31/2018 | Available for Sale Investment | Dr | $ 2,065.00 | |
To Gain on Available for Sale Investment | Cr | $ 2,065.00 | |||
(Being Gain in Fair value and amortised cost recognised in other Comprehensive income | |||||
Problem 17-1 Presented below is an amortization schedule related to Kingbird Company's 5-year, $110,000 bond with...
Presented below is an amortization schedule related to Blue Company’s 5-year, $110,000 bond with a 6% interest rate and a 4% yield, purchased on December 31, 2015, for $119,794. Date Cash Received Interest Revenue Bond Premium Amortization Carrying Amount of Bonds 12/31/15 $119,794 12/31/16 $6,600 $4,792 $1,808 117,986 12/31/17 6,600 4,719 1,881 116,105 12/31/18 6,600 4,644 1,956 114,149 12/31/19 6,600 4,566 2,034 112,115 12/31/20 6,600 4,485 2,115 110,000 The following schedule presents a comparison of the amortized cost and fair...
Problem 17-01 Presented below is an amortization schedule related to Buffalo Company's 5-year, $180,000 bond with a 6% interest rate and a 3% yield, purchased on December 31, 2018, for $204,731. Cash Interest Received Revenue Bond Premium Amortization Date 12/31/18 12/31/19 12/31/20 12/31/21 12/31/22 12/31/23 $10,800 10,800 10,800 10,800 10,800 $6,142 6,002 5,858 5,710 5,557 $4,658 4,798 4,942 5,090 5,243 Carrying Amount of Bonds $204,731 200,073 195,275 190,333 185,243 180,000 The following schedule presents a comparison of the amortized cost...
Problem 17-1 Presented below is an amortization schedule related to Riverbed Company's 5-year $160,000 bond with a 8% interest rate and a 6% yield, purchased on December 31, 2015, for 3173,480 Interest Bond Premium Amortization Carrying Amount Date Received $173.480 171.089 12/31/15 12/31/16 12/31/17 12/31/18 12/31/19 12/31/20 $12,800 12.500 12,800 12.800 1 2,500 $10.409 10.265 10,113 9,052 5.751 $2,391 2.535 2.587 2.345 301 168,554 165,867 e of the bonds at year endi The following schedule presents a comparison of the...
Presented below is an amortization schedule related to Martinez Company's 5-year, $140,000 bond with a 6% interest rate and a 3% yield, purchased on December 31, 2018, for $159,235. Cash Received Interest Revenue Bond Premium Amortization Carrying Amount of Bonds Date 12/31/18 $159,235 12/31/19 $8,400 $4,777 $3,623 155,612 12/31/20 8,400 4,668 3,732 151,880 12/31/21 8,400 4,556 3,844 148,036 12/31/22 8,400 4,441 3,959 144,077 12/31/23 8,400 4,323 4,077 140,000 The following schedule presents a comparison of the amortized cost and fair...
Presented below is an amortization schedule related to Culver Company’s 5-year, $150,000 bond with a 7% interest rate and a 4% yield, purchased on December 31, 2018, for $170,034. Date Cash Received Interest Revenue Bond Premium Amortization Carrying Amount of Bonds 12/31/18 $170,034 12/31/19 $10,500 $6,801 $3,699 166,335 12/31/20 10,500 6,653 3,847 162,488 12/31/21 10,500 6,500 4,000 158,488 12/31/22 10,500 6,340 4,160 154,328 12/31/23 10,500 6,172 4,328 150,000 The following schedule presents a comparison of the amortized cost and fair...
Presented below is an amortization schedule related to Flounder Company's 5-year, $170,000 bond with a 7% interest rate and a 4% yield, purchased on December 31, 2015, for $192,705. Cash Interest Received Revenue Bond Premium Amortization Date 12/31/15 12/31/16 12/31/17 12/31/18 12/31/19 12/31/20 $11,900 11,900 11,900 11,900 11,900 $7,708 7,541 7,366 7,185 6,995 $4,192 4,359 4,534 4,715 4,905 Carrying Amount of Bonds $192,705 188,513 184,154 179,620 174,905 170,000 The following schedule presents a comparison of the amortized cost and fair...
Presented below is an amortization schedule related to Buffalo Company's 5-year, $150,000 bond with a 6% Interest rate and a 4% yleld, purchased on December 31, 2018, for $163,356. Bond Premlum Carrylng Amount Cash Recelved Interest Revenue Date Amortization of Bends $163,356 160,890 158,326 12/31/18 12/31/19 $6,534 $2,466 2,564 2,667 $0,000 12/31/20 9,000 6,416 12/31/21 9,000 6,333 155,659 9,000 6,226 2,774 152,885 12/31/22 12/31/23 9,000 6,115 2,885 150,000 The following schedule presents a compartson of the amortized cost and fair...
HW 17-7-Debt Securities AS CORRECTED Presented below is an amortization schedue related to the Orlando Magic's 5 year, $200,000 bond with a 5% interest rate and a 5% yield, purchased on December 31, 2018 for $191,575. Bond Discount Carrying Amount Date Cash Received Interest Revenue Amortization of Bond 12/31/2018 191,575 12/31/2019 10,000 11,495 1,495 193,070 12/31/2020 10,000 11,584 1,584 194,654 12/31/2021 10,000 11,679 1,679 196,333 12/31/2022 10,000 11,780 1,780 198,113 12/31/2023 10,000 11,887 1,887 200,000 Instructions (a) Prepare the journal...
Problem 17-04 Presented below is information taken from a bond investment amortization schedule with related fair values provided. These bonds are classified as available-for-sale. Amortized cost Fair value 12/31/20 $533,200 $539,200 1 2/31/21 $477,000 $465,900 12/31/22 $531,700 $531,700 (a) Indicate whether the bonds were purchased at a discount or at a premium. (b) Prepare the adjusting entry to record the bonds at fair value at December 31, 2020. The Fair Value Adjustment account has a debit balance of $1,000 prior...
Problem 9-3 The following amortization schedule is for Monty Ltd.’s investment in Spangler Corp.’s $107,200, five-year bonds with a 10% interest rate and a 8% yield, which were purchased on December 31, 2019, for $115,760: Cash Received Interest Income Bond Premium Amortized Amortized Cost of Bonds Dec. 31, 2019 $115,760 Dec. 31, 2020 $10,720 $9,261 $1,459 114,301 Dec. 31, 2021 10,720 9,144 1,576 112,725 Dec. 31, 2022 10,720 9,018 1,702 111,023 Dec. 31, 2023 10,720 8,882 1,838 109,185 Dec. 31,...