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On January 1, 2025, Bonita Company purchased 12% bonds having a maturity value of $276,000 for $296,924,88. The bonds provide the bondhoiders with a 10
On January 1, 2025, Bonita Company purchased 12% bonds having a maturity value of $276,000 for $296,924,88. The bonds provide the bondhoiders with a 10 yiedd, They are dated fanuary 1,2025 , and mature finuary 1,2030 , with interest received on January 1 of each year. Bonita Company uses the effective-interest mothod to allocate uramorticed discount or premium. The bonds are classified as available-for-sale category. The fair value of the bonds at December 31 of each year-end is as follows. (a) Prepare the journal entry at the date of the bond purchase (b) Prease the ioumal entries torecocd the interest revenue and recognat on of fair value for 2025 (c) Propare the icournal entry to record the recoenition of fair value for 2026 . Wht all debit entries before credit entries. Credit account tities arz automatically indented when amount is entered. Do not indent manually if no entry ls required, select "No Entry" for the occount titles and enter 0 for the amounts. Round answers to 2 decimal ploces, es 1225.25) Date Account Titles and Explanation Debit Credit Debt investments Bonds Parable Casti (To record interest received) (To record fair value adjustment)
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