Business, 12.04.2021 20:40 KingOfLaBron23

On January 1, 2020, Vaughn Company purchased $500,000, 10% bonds of Aguirre Co. for $463,197. The bonds were purchased to yield 12% interest. Interest is payable semiannually on July 1 and January 1. The bonds mature on January 1, 2025. Vaughn Company uses the effective-interest method to amortize discount or premium. On January 1, 2022, Vaughn Company sold the bonds for $464,885 after receiving interest to meet its liquidity needs. Required:
(a) Determine the purchase price and prepare the journal entry to record the purchase of bonds on January 1, 2017.
(b) Prepare the amortization schedule for the bonds.
(c) Prepare the journal entries to record/accrue the semiannual interest each period.
(d) The fair value of the bonds is $372,726 on December 31, 2018, prepare the necessary adjusting entry.
Note that the fair value adjustment balance on December 31, 2017, is a debit of $3,375.
(e) Prepare the journal entry to record the sale of the bonds on January 1, 2019.

Answers: 2

Show answers

Another question on Business

Business, 22.06.2019 12:30

howard, fine, & howard is an advertising agency. the firm uses an activity-based costing system to allocate overhead costs to its services. information about the firm's activity cost pool rates follows: stooge company was a client of howard, fine, & howard. recently, 7 administrative assistant hours, 3 new ad campaigns, and 8 meeting hours were incurred for the stooge company account. using the activity-based costing system, how much overhead cost would be allocated to the stooge company account?

Answers: 1

Answer

Business, 22.06.2019 13:00

Dakota products has a production budget as follows: may, 16,000 units; june, 19,000 units; and july, 24,000 units. each unit requires 3 pounds of raw material and 2 direct labor hours. dakota desires to keep an inventory of 10% of the next month’s requirements on hand. on may, 1 there were 4,800 pounds of raw material in inventory. direct labor hours required in may would be:

Answers: 1

Answer

Business, 22.06.2019 16:50

In terms of the "great wheel of science", statistics are central to the research process (a) only between the hypothesis phase and the observation phase (b) only between the observation phase and the empirical generalization phase (c) only between the theory phase and the hypothesis phase (d) only between the empirical generalization phase and the theory phase

Answers: 1

Answer

Business, 22.06.2019 17:50

Abc factory produces 24,000 units. the cost sheet gives the following information: direct materials rs. 1,20,000direct labour rs. 84,000variable overheads rs. 48,000semi variable overheads rs. 28,000fixed overheads rs. 80,000total cost rs. 3,60,000presently the product is sold at rs. 20 per unit.the management proposes to increase the production by 3,000 units for sales in the foreign market . it is estimated that semi variable overheads will increase by rs. 1,000. but the product will be sold at rs. 14 per unit in the foreign market. however, no additional capital expenditure will be incurredq-1. what is present profit of the company ? q-2. what is proposed profit of the company in new market? q-3.what is suggestion for new makret proposal whether proposal accept or not

Answers: 1

Answer

You know the right answer?

On January 1, 2020, Vaughn Company purchased $500,000, 10% bonds of Aguirre Co. for $463,197. The bo...

Questions