Problem 15-2

On August 1, 2011, Airport Company sold Paxton Company $1,000,000 of 10-year, 6% bonds, dated July 1 at 100 plus accrued interest. On March 1, 2012, Paxton sold half of the bonds for $520,000 plus accrued interest. Present entries to record the following transactions:

Paxton Company:

1. Purchase of bonds on August 1, 2011.
2. Receipt of first semiannual interest amount on December 31, 2011.
3. The sale of the bonds on March 1, 2012.