The following transactions relate to bond investments of Livermore Laboratories The companys fiscal year ends on December 31 Livermore uses the straight line method to determine interest 2018 July 1 Purchased $16 million of Bracecourt Corporation 10 debentures, due in 20 years (June 30, 2038), for $15 7 million Interest is payable on January 1 and July 1 of each year Oct 1 Purchased $30 million of 12 Framm Pharmaceuticals debentures, due May 31, 2028, for $31,160,000 plus accrued interest Interest is payable on June 1 and December 1 of each year Dec 1 Received interest on the Framm bonds Dec 31 Accrued interest 2019 Jan 1 Received interest on the Bracecourt bonds June 1 Received interest on the Framm bonds July 1 Received interest on the Bracecourt bonds Sept 1 Sold $15 million of the Framm bonds at 101 plus accrued interest Dec 1 Received interest on the remaining Framm bonds Dec 31 Accrued interest 2020 Jan 1 Received interest on the Bracecourt bonds Feb 28 Sold the remainder of the Framm bonds at 102 plus accrued interest Dec 31 Accrued interest Required 1 Prepare the appropriate journal entries for these long term bond investments 2 By how much will Livermore Labs earnings increase in each of the three years as a result of these investments (Ignore income taxes )

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The following transactions relate to bond investments of Livermore Laboratories. The companys fiscal year ends on December 31. Livermore uses the straight-line method to determine

The following transactions relate to bond investments of Livermore Laboratories. The companys fiscal year ends on December 31. Livermore uses the straight-line method to determine interest. 2018

July	1	Purchased $16 million of Bracecourt Corporation 10% debentures, due in 20 years (June 30, 2038), for $15.7 million. Interest is payable on January 1 and July 1 of each year.
Oct.	1	Purchased $30 million of 12% Framm Pharmaceuticals debentures, due May 31, 2028, for $31,160,000 plus accrued interest. Interest is payable on June 1 and December 1 of each year.
Dec.	1	Received interest on the Framm bonds.
Dec.	31	Accrued interest.

2019

Jan.	1	Received interest on the Bracecourt bonds.
June	1	Received interest on the Framm bonds.
July	1	Received interest on the Bracecourt bonds.
Sept.	1	Sold $15 million of the Framm bonds at 101 plus accrued interest.
Dec.	1	Received interest on the remaining Framm bonds.
Dec.	31	Accrued interest.

2020

Jan.	1	Received interest on the Bracecourt bonds.
Feb.	28	Sold the remainder of the Framm bonds at 102 plus accrued interest.
Dec.	31	Accrued interest.

Required:

1. Prepare the appropriate journal entries for these long-term bond investments. 2. By how much will Livermore Labs earnings increase in each of the three years as a result of these investments? (Ignore income taxes.)