Blossom Company purchased $1180000 of8%, 5-year bonds from Carlin, Inc. on January1, 2021, with interest payable on July 1 andJanuary 1. The bonds sold for $1230096 at aneffective interest rate of 7%. Using theeffective interest method, Blossom Companydecreased the Available-for-Sale DebtSecurities account for the Carlin, Inc. bondson July 1, 2021 and December 31, 2021 by theamortízed premiums of $4048 and $4192,respectively. At February 1, 2022, BlossomCompany sold the Carlin bonds for $1215800.After accruing for interest, the carrying valueof the Carlin bonds on February 1, 2022 was$1220500. Assuming Blossom Company has aportfolio of available-for-sale debtinvestments, what should Blossom Companyreport as a gain (or loss) on the bonds?$-4700.$0.$-9596.$-14296.

Bonds refers to the units of corporate debts which are issued by companies and also securitized…

Blossom Company purchased $1180000 of 8%, 5-year bonds from Carlin, Inc. on January 1, 2021, with interest payable on July 1 and January 1. The bonds sold for $1230096 at an effective interest rate of 7%. Using the effective interest method, Blossom Company decreased the Available-for-Sale Debt Securities account for the Carlin, Inc. bonds on July 1, 2021 and December 31, 2021 by the amortized premiums of $4048 and $4192,

Blossom Company purchased $1180000 of 8%, 5-year bonds from Carlin, Inc. on January 1, 2021, with interest payable on July 1 and January 1. The bonds sold for $1230096 at an effective interest rate of 7%. Using the effective interest method, Blossom Company decreased the Available-for-Sale Debt Securities account for the Carlin, Inc. bonds on July 1, 2021 and December 31, 2021 by the amortized premiums of $4048 and $4192,

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 6RE: Refer to the information in RE13-5. Assume that on June 30, Aggie received interest on the Smith...

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