Colah Company purchased $2,600,000 of Jackson, Inc., 6% bonds at their face amount on July 1, 2021, with interest paid semi-annually. The bonds mature in 20 years but Colah planned to keep them for less than 3 years, and classified them as available for sale investments. When the bonds were acquired Colah decided to elect the fair value option for accounting for its investment. At December 31, 2021, the Jackson bonds had a fair value of $2,960,000. Colah sold the Jackson bonds on July 1, 2022 for $2,340,000.
The purchase of the Jackson bonds on July 1.
Interest revenue for the last half of 2021.
Any year-end 2021 adjusting entries.
Interest revenue for the first half of 2022.
Any entry or entries necessary upon sale of the Jackson bonds on July 1, 2022.
Required:
1. Prepare Colah’s journal entries for above transactions.
2. Complete the following table to show the effect of the Jackson bonds on Colah’s net income, other comprehensive income, and comprehensive income for 2021, 2022, and cumulatively over 2021 and 2022.
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Colah Company purchased $1,700,000 of Jackson, Inc., 5% bonds at their face amount on July 1, 2021, with interest paid semi-annually. The bonds mature in 20 years but Colah planned to keep them for less than 3 years, and classified them as available for sale investments. When the bonds were acquired Colah decided to elect the fair value option for accounting for its investment. At December 31, 2021, the Jackson bonds had a fair value of $1,970,000. Colah sold the...
Exercise 12-26 (Algo) Fair value option; available-for-sale investments [LO12-2, 12-3, 12-8] Colah Company purchased $2,700,000 of Jackson, Inc., 5% bonds at their face amount on July 1, 2021, with interest paid semi- annually. The bonds mature in 20 years but Colah planned to keep them for less than 3 years, and classified them as available for sale investments. When the bonds were acquired Colah decided to elect the fair value option for accounting for its investment. At December 31, 2021,...
Colah Company purchased $1,000,000 of Jackson, Inc., 5% bonds at their face amount on July 1, 2021, with interest paid semi- annually. The bonds mature in 20 years but Colah planned to keep them for less than 3 years, and classified them as available for sale Investments. When the bonds were acquired Colah decided to elect the fair value option for accounting for its Investment. At December 31, 2021, the Jackson bonds had a fair value of $1,200,000. Colah sold...
Colah Company purchased $1,900,000 of Jackson, Inc., 7% bonds at par on July 1, 2021, with interest paid semi-annually. Colah determined that it should account for the bonds as an available-for-sale investment. At December 31, 2021, the Jackson bonds had a fair value of $2,190,000. Colah sold the Jackson bonds on July 1, 2022 for $1,710,000. Required: 1. Prepare Colah's journal entries for the following transactions: a. The purchase of the Jackson bonds on July 1. b. Interest revenue for...
Colah Company purchased $3.0 million of Jackson, Inc. 5% bonds at par on July 1, 2018, with interest paid semi-annually. When the bonds were acquired Colah decided to elect the fair value option for accounting for its investment. At December 31, 2018, the Jackson bonds had a fair value of $3.40 million. Colah sold the Jackson bonds on July 1, 2019 for $2,700,000. The purchase of the Jackson bonds on July 1. Interest revenue for the last half of 2018....
PLEASE PUT SOLUTION IN THE SAME FORMAT AS THE IMAGE. THANK YOU! Exercise 12-26 (Algo) Fair value option; available-for-sale Investments [LO12-2, 12-3, 12-8] Colah Company purchased $2,400,000 of Jackson, Inc., 6% bonds at their face amount on July 1, 2021, with Interest pald semi- annually. The bonds mature in 20 years but Colah planned to keep them for less than 3 years, and classified them as available for sale Investments. When the bonds were acquired Colah decided to elect the...
Colah Company purchased $2.7 million of Jackson, Inc., 5% bonds at par on July 1, 2018, with interest paid semi-annually. Colah determined that it should account for the bonds as an available-for-sale investment. At December 31, 2018, the Jackson bonds had a fair value of $3.07 million. Colah sold the Jackson bonds on July 1, 2019 for $2,430,000. The purchase of the Jackson bonds on July 1. Interest revenue for the last half of 2018. Any year-end 2018 adjusting entries....
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Exercise 12-12 Available-for-sale securities (L012-1, 12-4) Colah Company purchased $1.6 million of Jackson, Inc., 6% bonds at par on July 1, 2018, with interest pald semi-annually. Colah determined that it should account for the bonds as an available for sale investment. At December 31, 2018, the Jackson bonds had a fair value of $1.86 millon. Colah sold the Jackson bonds on July 1, 2019 for $1.440,000 a. The purchase of the Jackson bonds on July 1 b. Interest revenue for...
PLEASE PUT SOLUTION IN THE SAME FORMAT AS THE IMAGE. THANK YOU! Exercise 12-12 (Algo) Available-for-sale securities (LO12-1, 12-4] Colah Company purchased $2,200,000 of Jackson, Inc., 7% bonds at par on July 1, 2021, with Interest pald semi-annually. Colah determined that it should account for the bonds as an available-for-sale Investment. At December 31, 2021, the Jackson bonds had a fair value of $2.520,000. Colah sold the Jackson bonds on July 1, 2022 for $1,980,000. Required: 1. Prepare Colah's Journal...