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Epoch Star & Co. owns vast amounts of corporate bonds. Suppose Epoch Star buys $600,000 of BitterCo bonds at face value on January 2, 2018.
Epoch Star & Co. owns vast amounts of corporate bonds. Suppose Epoch Star buys $600,000 of BitterCo bonds at face value on January 2, 2018. The BitterCo bonds pay interest at the annual rate of 4% on June 30 and December 31 and mature on December 31, 2022. Epoch Star intends to hold the investment until maturity. Requirements 1. Journalize any required 2018 entries for the bond investment. 2. How much cash interest will Epoch Star receive each year from BitterCo? 3. How much interest revenue will Epoch Star report during 2018 on this bond investment? Requirement 1. Journalize any required 2018 entries for the bond investment. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Begin by journalizing Epoch Star's investment on January 2, 2018. Date Accounts and Explanation Debit Credit 2018 Jan. 2 Next, journalize the receipt of cash interest on June 30, 2018. Next, journalize the receipt of cash interest on June 30, 2018. Date Accounts and Explanation Debit Credit 2018 Jun. 30 Now journalize the receipt of cash interest on December 31, 2018. Date Accounts and Explanation Debit Credit 2018 2018 Dec. 31 Requirement 2. How much cash interest will Epoch Star receive each year from BitterCo? Epoch Star will receive $ of cash interest each year from BitterCo. Requirement 3. How much interest revenue will Epoch Star report during 2018 on this bond investment? Epoch Star will report $ of interest revenue during 2018 on this bond investment. Choose from any list or enter any number in the input fields and then continue to the next
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