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On July 1, 2020, Montana Inc purchased for par, $300,000 of Upper Armour Co. 8% bonds that mature on June 30, 2025. Cash interest is

On July 1, 2020, Montana Inc purchased for par, $300,000 of Upper Armour Co. 8% bonds that mature on June 30, 2025. Cash interest is paid semiannually on June 30 and December 21. Montana classifies the investments as Available for Sale.

1. Prepare the journal entry for the purchase on July 1

2. Record the interest receipt on December 21, 2020.

3. The fair value of the bonds on December 31, 2020, is $280,000. Record, if necessary, any applicable journal entry

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