Question
On Jan 1,2001, A company purchased $20,000 of 10%,5years bonds of B company for $19,000. On July 1,2001, Bonds: Amortized cost -----$19,200, Selling for $19,400
On Jan 1,2001, A company purchased $20,000 of 10%,5years bonds of B company for $19,000.
On July 1,2001, Bonds: Amortized cost -----$19,200, Selling for $19,400
On Dec 31,2001,Bonds: Amortized cost-----$19,300, Selling for $19,500
The bonds pay interest semi-annually on Jan1, July 1.
1.If A company wants to sell the bond on Aug,2001, classify the investment. What amount should the company report the bonds at July 1,2001? Prepare Journal entry to report FV adjustment on July 1,2001?
2.If A company will hold the bond until Jan 1,2006, What amount should be report at Dec 31,2001?Prepare Journal entry to report FV adjustment on Dec 31,2001?
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Cost Accounting Principles And Applications
Authors: Horace Brock, Linda Herrington, La Vonda Ramey
7th Edition
0071115609, 978-0071115605
