On March 1, 2008, Gordon Corporation purchases ($ 50,000) of (10 %) bonds of PUA-Tech Corporation, due

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On March 1, 2008, Gordon Corporation purchases \(\$ 50,000\) of \(10 \%\) bonds of PUA-Tech Corporation, due in \(9 \frac{1}{4}\) years. The bonds were purchased at a price of \(\$ 40,000\) plus interest of \(\$ 1,250(\$ 50,000 \times 10 \% \times 3 / 12)\) accrued from December 1, 2007, the date of the last semiannual interest payment.

(a) Journalize the purchase of the bonds plus accrued interest.

(b) Journalize the entry to record the amortization of the discount on December 31.

objs. 2, 3

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Financial Accounting

ISBN: 9780324380675

10th Edition

Authors: Carl S. Warren, James M. Reeve, Jonathan Duchac

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