Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Problems 1. On May 1, 2019, Binus Co purchase $120,000, 5 years bond of Hippo Co with interest 7% and yield 5% for 130,502. The
Problems 1. On May 1, 2019, Binus Co purchase $120,000, 5 years bond of Hippo Co with interest 7% and yield 5% for 130,502. The interest will be paid semi-annually on November 1 and May 1. Following schedule present fair value of bond every end of the year Year December 31, 2019 December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 May 1, 2024 Fair Value $128,650 $129,458 $127,450 $124,120 $120,000 $120,000 Instruction: a. Prepare the schedule of amortisation of the bonds b. Prepare journal entry to record the purchase of bonds on May 1, 2019, assuming the bonds are classified as Held-for-collection investment C. Prepare journal entry(ies) related to held-for-collection bonds for 2020 d. Prepare journal entry(ies) related to held-for-collection bonds for 2022 e. Prepare journal entry to record the purchase of bonds on May 1, 2019, assuming the bonds are classified as trading investment f. Prepare journal entry(ies) related to trading bonds for 2021 g. Prepare journal entry(ies) related to trading bonds for 2023
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started