On January 1, 2014, Chan Ltd. purchased $600,000 of fi ve-year, 4% bonds at par from Pullen

Question:

On January 1, 2014, Chan Ltd. purchased $600,000 of fi ve-year, 4% bonds at par from Pullen Corporation. Interest is received semi-annually on July 1 and January 1. Chan purchased the bonds to earn interest. At December 31, 2014, the bonds were trading at 101. Prepare the journal entries to record
(a) The purchase of the bonds on January 1,
(b) The receipt of interest on July 1, and
(c) Any adjusting entries required at December 31.