Question

Bond Investment Transactions Journalize the entries to record the following selected bond investment transactions for Starks...

Bond Investment Transactions

Journalize the entries to record the following selected bond investment transactions for Starks Products:

For a compound transaction, if an amount box does not require an entry, leave it blank.

a. Purchased for cash $60,000 of Iceline, Inc. 7% bonds at 100 plus accrued interest of $700, paying interest semiannually.

fill in the blank 633f5ef48fda07a_2 fill in the blank 633f5ef48fda07a_3
fill in the blank 633f5ef48fda07a_5 fill in the blank 633f5ef48fda07a_6
fill in the blank 633f5ef48fda07a_8 fill in the blank 633f5ef48fda07a_9

b. Received first semiannual interest payment.

fill in the blank 8788dffa2fa702d_2 fill in the blank 8788dffa2fa702d_3
fill in the blank 8788dffa2fa702d_5 fill in the blank 8788dffa2fa702d_6
fill in the blank 8788dffa2fa702d_8 fill in the blank 8788dffa2fa702d_9

c. Sold $40,000 of the bonds at 103 plus accrued interest of $460.

fill in the blank af968a063034f85_2 fill in the blank af968a063034f85_3
fill in the blank af968a063034f85_5 fill in the blank af968a063034f85_6
fill in the blank af968a063034f85_8 fill in the blank af968a063034f85_9
fill in the blank af968a063034f85_11 fill in the blank af968a063034f85_12

Homework Answers

Answer #1

a. Purchased for cash $60,000 of Iceline, Inc. 7% bonds at 100 plus accrued interest of $700, paying interest semiannually.

a Investment in bonds 60000
Interest receivable 700
Cash 60700

b. Received first semiannual interest payment.

Cash 4200
Interest receivable 700
Interest revenue 3500

c. Sold $40,000 of the bonds at 103 plus accrued interest of $460.

Cash (40000*1.03+460) 41660
Investment in bonds 40000
Interest receivable 460
Gain on sale of investment 1200
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