Question
On 01-01-16, B purchased 300, $1,000 4% bonds when similar bonds were paying 5%. B incurred and paid $3,000 of bond purchase-related costs. The bonds
On 01-01-16, B purchased 300, $1,000 4% bonds when similar bonds were paying 5%. B incurred and paid $3,000 of bond purchase-related costs. The bonds were dated 01-01-16 and pay interest each January 1 and July 1 and mature on 01-01-18. B has the intent and the ability to hold these bonds until they mature. The bonds were trading at the following amounts as of the following dates: 12-31-16 99 12-31-17 100 These bonds are Bs only investment. B closes its books every December 31. Prepare the entries B should make on: a. 01-01-16. b. 12-31-16. c. 01-01-17. d. 12-31-17. e. 01-01-18.
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