Question
On July 1, 2020, Sandhill Corporation purchased at par 6% bonds having a maturity value of $ 320,000. The bonds are dated July 1, 2020,
On July 1, 2020, Sandhill Corporation purchased at par 6% bonds having a maturity value of $ 320,000. The bonds are dated July 1, 2020, and mature July 1, 2025, with interest payable on July 1 of each year. The bonds are classified in the held-to-maturity category, and the company does not use reversing entries.
| (a) | Prepare the journal entry at the date of the bond purchase. | |
| (b) | Prepare the journal entry to record the interest earned and interest received for 2020. | |
| (c) | Prepare the journal entries to record the interest earned and interest received for 2021. |
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Intermediate Accounting
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
18th Edition
1119790972, 9781119790976
