Question 1 Partially correct Mark 1.76 out of 4.00 P Rag question On July 1 of the current year, West Company purchased for cash, 8, $10,000 bonds of North Corporation to yield 10%. The bonds pay 9% interest, payable on a semiannual basis each July 1 and January 1, and mature in three years on July 1. The bonds are classified as held-to-maturity securities. The annual reporting period ends December 31. Assume the straight- line interest method of amortization of any discount or premium. Amortization Schedule Journal Entries in Year 1 Financial Statement Presentation Journal Entries in Year 2 a. Prepare a bond amortization schedule for the current year and the following year using the straight-line interest method. Note: Round each amount entered into the schedule below to the nearest whole dollar, Date Stated Interest Jul. 1. Year 1 Jan. 1. Year 25 Jul. 1. Year 2 Market Discount Bond Interest Amortization Amortized Cost $ 77.970 3.938 $ 338 78,308 3,938 338 78.646 3,6005 3.600 Check Partially correct Marks for this submission: 1.76/4.00 Save Answers Question 1 Partially correa Mark 1.76 out of 4.00 p Flag question On July 1 of the current year, West Company purchased for cash, 8, 510,000 bonds of North Corporation to yield 10%. The bonds pay 9% interest, payable on a semiannual basis each July 1 and January 1, and mature in three years on July 1. The bonds are classified as held-to-maturity securities. The annual reporting period ends December 31. Assume the straight- line interest method of amortization of any discount or premium. Amortization Schedule Journal Entries in Year 1 Financial Statement Presentation Journal Entries in Year 2 b. Record the entry for the purchase of the bonds by West Company on July 1. Date Account Name Jul. 1. Year 1 Investment in HTM Securities Cash To record investment purchase. Debit 77.970 0 Credit 0 77,970 V c. Record the adjusting entry by West Company on December 31. The fair value of the bonds at December 31 was $81,000. Date Credit Account Name Dec. 31. Year 1 Cash Investment in HTM Securities Interest Revenue To record year end adjusting entry Debit 3.600 0 OX 2.030 X 81,000 X 0 Check Partially correct Marks for this submission: 1.76/4.00. Question 1 Partially correct Mark 1.76 out of 4.00 P Pag question On July 1 of the current year, West Company purchased for cash, 8, 510,000 bonds of North Corporation to yield 109. The bonds pay 9% interest, payable on a semiannual basis each July 1 and January 1, and mature in three years on July 1. The bonds are classified as held-to-maturity securities. The annual reporting period ends December 31. Assume the straight- line interest method of amortization of any discount or premium Amortization Schedule Journal Entries in Year 1 Financial Statement Presentation Journal Entries in Year 2 d. Indicate the effects of this investment on the current year's income statement and year-end balance sheet. Income Statement Year 1 Balance Sheet Dec. 31. Year Other Revenues and Gains Interest revenue 5 3.899 X Assets Interest receivable 5 78.268 x Investment in HTM Securities s 3.600 X Check Partially correct Marks for this submission: 1.76/4.00 Save Answers Question 1 Partially correct Mark 1.76 out of 4.00 Pag question On July 1 of the current year, West Company purchased for cash, 8, 510,000 bonds of North Corporation to yield 10%. The bonds pay 9% interest, payable on a semiannual basis each July 1 and January 1, and mature in three years on July 1. The bonds are classified as held-to-maturity securities. The annual reporting period ends December 31. Assume the straight- line Interest method of amortization of any discount or premium. Amortization Schedule Journal Entries in Year Financial Statement Presentation Journal Entries in Year 2 e. Record the receipt of interest on January 1, Year 2. Account Name Debit Credit Date Jan. 1. Year 2 0 0X 0 0X To record interest receved f. After the interest payment on July 1, Year 2, two of the bonds were sold for $19,300 cash. Provide the required entries on that date. Account Name Debit Credit Date Jul. 1. Year 2 OX OX To record interest received