Question
Lamar Corporation owns 60 percent of Humbolt Corporations voting shares. On January 1, 20X2, Lamar Corporation sold $240,000 par value, 6 percent first mortgage bonds
Lamar Corporation owns 60 percent of Humbolt Corporations voting shares. On January 1, 20X2, Lamar Corporation sold $240,000 par value, 6 percent first mortgage bonds to Humbolt for $248,000. The bonds mature in 10 years and pay interest semiannually on January 1 and July 1.
A. Prepare the journal entries for 20X2 for Humbolt related to its ownership of Lamars bonds
1.Record the investment in the bonds of Lamar Corporation.
Investment oin lemar corporation bonds
Cash
2.Record the semiannual interest income received.
Cash
Interest Income
Investment in Lamar corporation bonds
3.Record the semiannual interest receivable.
Interest recievables
Interest Income
Investment in Lamar corporation Bonds
Please throughly show how you come up with the interest income and investment in lamar corporation bonds in part two. This is the part that I really dont get
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