Cassidy Ltd. purchased $80,000 Stump Inc., 3% bonds at par value on October 1, 2015. Cassidy intends

Question:

Cassidy Ltd. purchased $80,000 Stump Inc., 3% bonds at par value on October 1, 2015. Cassidy intends to hold the bonds to maturity in 2025. The bonds pay interest on October 1 and April 1. On April 1, 2016, Cassidy sold $30,000 par value Stump Inc. bonds at 97, after receipt of the interest.

Journalize the entries to record the following:

a. The initial acquisition of the Stump Inc. bonds on October 1, 2015.

b. The adjusting entry for 91 days of accrued interest earned on the Stump Inc. bonds on December 31, 2015.

c. The receipt of semiannual interest on April 1, 2016.

d. The sale of $30,000 Stump Inc. bonds on April 1, 2016, at 97.

Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...