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On January 1, 2021, Buffalo Ltd. issued bonds with a maturity value of $5.40 million for $5,175,360, when the market rate of interest was 7%.

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On January 1, 2021, Buffalo Ltd. issued bonds with a maturity value of $5.40 million for $5,175,360, when the market rate of interest was 7%. The bonds have a contractual interest rate of 6% and mature on January 1, 2026. Interest on the bonds is payable semi-annually on July 1 and January 1 of each year. On January 1, 2021, Sunland Company, a public company, purchased Buffalo Ltd. bonds with a maturity value of $1.08 million to earn interest. On December 31, 2021, the bonds were trading at 97. Both companies' year end is December 31. What amount did Sunland Company pay for Buffalo Ltd's bonds? (Round answer to decimal places, eg. 5,275.) $ 1035072 Sunland Company paid Prepare the journal entry for Sunland Company (investor) on January 1, 2021. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts. Round answers to decimal places, eg. 5,275.) Date Credit Debit Account Titles and Explanation Jan. 1 1035072 Cash (To record purchase of investment.) Interest Revenue Gain on Sale of Bonds Interest Expense Investment Income or Loss iny (inve ually. If n 3.5,275. Interest Payable Interest Receivable Cash (To record purchase of investment.) Investment Income or Loss n m Interest Payable na Interest Receivable Bonds Payable Cash t in 20 u al Investments at Amortized Cost g. No Entry Cash (To record purchase of investment.)

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