Entries for Held-to-Maturity Securities on January 1, 2010, Jennings Company purchased at par 10% bonds having a

Question:

Entries for Held-to-Maturity Securities on January 1, 2010, Jennings Company purchased at par 10% bonds having a maturity value of $300,000. They are dated January 1, 2010, and mature January 1, 2015, with interest receivable December 31 of each year. The bonds are classified in the held-to-maturity category.

(a) Prepare the journal entry at the date of the bond purchase.

(b) Prepare the journal entry to record the interest received for 2010.

Bonds
When companies need to raise money, issuing bonds is one way to do it. A bond functions as a loan between an investor and a corporation. The investor agrees to give the corporation a specific amount of money for a specific period of time in exchange... 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...