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Please help to solve #2. Thank you! On January 1, 2018, ABC Company purchases the bonds of XYZ Company. The bonds have a face value
Please help to solve #2. Thank you!
On January 1, 2018, ABC Company purchases the bonds of XYZ Company. The bonds have a face value of $150,000 and a stated rate of interest of 6%. Interest is paid on 6/30 and 12/31 and the bonds mature on January 1, 2028. On 1/5/2019 the bonds were sold for $125,000 The market rate of interest is: 1/1/2018 7.0%, d 6/30/2018 8.0% 12/31/2018 9.096- Scenario 1: Assume HTM Scenario 2: Assume Available for Sale Scenario 3: Assume Trading Securitye Under each scenario, Please calculate the selling price of the bonds and prepare the appropriate purchase of the investment by ABC Please prepare ABC journal entries for interest for 6/30/2018 and for adjustment to FMV (hint: use the market rate on 6/30/2018 to determine FMV) Please prepare ABC journal entries for interest for 12/31/2018 and for adjustment to FMV (hint: use the market rate on 12/31/2018 to determine FMV) Please record the sale of the investment on 1/5/2019- 1. 2. 3. 4Step by Step Solution
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