Question
Gonzalez Company acquired $204,000 of Walker Co., 7% bonds on May 1 at their face amount. Interest is paid semiannually on May 1 and November
Gonzalez Company acquired $204,000 of Walker Co., 7% bonds on May 1 at their face amount. Interest is paid semiannually on May 1 and November 1. On November 1, Gonzalez Company sold $57,600 of the bonds for 97.
Journalize entries to record the following in Year 1 (refer to the Chart of Accounts for exact wording of account titles):
a. | The initial acquisition of the bonds on May 1. |
b. | The semiannual interest received on November 1. |
c. | The sale of the bonds on November 1. |
d. | The accrual of $1,708 interest on December 31. |
Journalize entries to record the transactions. Refer to the Chart of Accounts for exact wording of account titles.
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