Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

please make sure that there are enough account titles to debit and credit as there are lines shown in picture 2. The following information relates

image text in transcribed
image text in transcribed
please make sure that there are enough account titles to debit and credit as there are lines shown in picture
2. The following information relates to the debt securities investments of Larkspur Company, 1. On February 1, the company purchased 11% bonds of Gibbons Co. having a par value of $310,800 at 100 plus accrued interest. Interest is payable April 1 and October 1 On April 1, semiannual interest is received, 3. On July 1.8% bonds of Sampson, Inc. were purchased. These bonds with a par value of $192,000 were purchased at 100 plus accrued interest. Interest dates are June 1 and December 1 On September 1, bonds with a par value of $56,400, purchased on February 1, are sold at 98 plus accrued interest On October 1, semiannual interest is received On December 1, semiannual interest is received. 7. On December 31, the fair value of the bonds purchased February 1 and July 1 are 94 and 92, respectively. 4. 5. 6. (a) Prepare any journal entries you consider necessary, including year-end entries (December 31), assuming these are available for sale securities. (Note to instructor:Some students may debit interest Receivable at date of purchase instead of Interest Revenue. This procedure is correct, assuming that when the cash is received for the interest, an appropriate credit to interest Receivable is recorded.) (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter for the amounts (1) Feb. 1 (2) Apr1 (3) Jul 1 (4) Sep. 1 (5) Oct 1 (6) Dec 1 Dec 31 (To record interest To record adjustment.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

College Accounting Ch 1-12

Authors: Dansby

5th Edition

0763834955, 978-0763834951

More Books

Students also viewed these Accounting questions