ACCT 304 Study Guide - Final Guide: Stock Trader, Equity Method

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blushsnake623

14 Apr 2020

School

VCU

Department

Accounting

Course

ACCT 304

Professor

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Document Summary

On january 1, 2017, hummer company purchased 5% bonds, having a maturity value of. The bonds provide the bondholders with a 7% yield. January 1, 2017, and mature january 1, 2027, with interest receivable june 30 and december. Hummer company uses the effective-interest method to allocate unamortized discount or premium. The fair value of the bonds at december 31, 2017, was ,000, and the fair value of the bonds at. December 31, 2018 was ,000: prepare the journal entry at the date of the bond purchase. Cash: prepare the journal entries to record the interest received and recognition of fair value for. ,052: prepare the journal entry to record the recognition of fair value for 2018. What are the balances in the fair value adjustment afs and net, debt. Fair value adjustment afs -> credit balance of ,530. Net, debt investments afs -> debit balance of ,000 (market value)

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On January 1, 2014, Hmart Company purchased 5% bonds, having amaturity value of $500,000, for $428,938. The bonds provide thebondholders with a 7% yield. They are dated January 1, 2014, andmature January 1, 2024, with interest receivable June 30 andDecember 31 of each year. H-mart Company uses theeffective-interest method to allocate unamortized discount orpremium. The bonds are classified in the held-to-maturitycategory.

(a) Prepare the journal entry at the date of the bondpurchase.

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On January 1, 2017, Ayayai Company purchased 12% bonds, having a maturity value of $287,000, for $308,758.85. The bonds provide the bondholders with a 10% yield. They are dated January 1, 2017, and mature January 1, 2022, with interest received on January 1 of each year. Ayayai Company uses the effective-interest method to allocate unamortized discount or premium. The bonds are classified as available-for-sale category. The fair value of the bonds at December 31 of each year-end is as follows.

2017 $306,500 2020 $297,700

2018 $296,800 2021 $287,000

2019 $295,800

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On January 1, 2017, Marin Company purchased 8% bonds having a maturity value of $440,000, for $477,069.47. 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. Marin Company uses the effective-interest method to allocate unamortized discount or premium. The bonds are classified in the held-to-maturity category.

A) Prepare the journal entry at the date of the bond purchase.

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ACCT 304 Study Guide - Final Guide: Stock Trader, Equity Method

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