Question
: On 1/1/22, Lionel, Inc. purchased $50,000 H Companys 8% bonds for $54,000. Interest is paid each December 31, and the bonds mature in five
: On 1/1/22, Lionel, Inc. purchased $50,000 H Companys 8% bonds for $54,000. Interest is paid each December 31, and the bonds mature in five years. Lionel classifies the investment as trading and uses the straight-line amortization method.
Prepare journal entries to record the following:
The purchase of the bonds.
The receipt of the 12/31 interest payment.
The fair value of the investment at 12/31 is $52,000.
The bonds are sold on 01/01/2023 for $53,000.
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Accounting Principles
Authors: Jerry Weygandt, Paul Kimmel, Donald Kieso
12th edition
978-1118875056
