Blog

(b) (4 Points) For each of the following independent situati…

(b) (4 Points) For each of the following independent situations, prepare the journal entry that the Company would have instead recorded on December 31, 2024 (related only to the fair value of the investment) if the investment had originally been classified as follows rather than as available-for-sale. If no journal entry is required in any of the situations, write “no journal entry is required” – DO NOT LEAVE BLANK.

March 1, 2026: Account Debit Credit [account1] [debit1]…

March 1, 2026: Account Debit Credit [account1] [debit1] [credit1] [account2] [debit2] [credit2] [account3] [debit3] [credit3] [account4] [debit4] [credit4] [account5] [debit5] [credit5] [account6] [debit6] [credit6] [account7] [debit7] [credit7] [account8] [debit8] [credit8] [account9] [debit9] [credit9] [account10] [debit10] [credit10] Note: Disregard the fact that this question is labeled as having “0 points” – this question does have points associated and you should answer this question. This question and the previous question will be graded together for a combined total of 18 points.

Question 1. On October 1, 2025, the Company issued $400,000…

Question 1. On October 1, 2025, the Company issued $400,000 of 7%, 5-year bonds. The market rate at the time of issue was 9%. The bonds pay interest semiannually on April 1 and October 1 each year. The Company uses the effective-interest method to amortize any discount or premium. On March 1, 2026, the Company redeems the bonds at 102 plus accrued interest. Required: (a) (18 Points) Record the journal entries for the Company for each of the requested dates below. If required to round, round final answers to the nearest whole dollar. Assume that the Company prepares annual adjusting entries on December 31 each year. If no journal entry is required, write “no journal entry is required” – DO NOT LEAVE BLANK.