The following bond investment transactions were completed by Starks Company: Jan. 31 Purchased 42, $1,000 government bonds at 100 plus accrued interest of $210 (1 month). The bonds pay 6% annual interest on July 1 and January 1. July 1 Received semiannual interest on bond investment. Aug. 30 Sold 18, $1,000 bonds at 98 plus $180 accrued interest (2 months). a. Journalize the entries for these transactions. Assume a 360-day year. Do not round interim calculations. Round final answers to nearest dollar. If an amount box does not require an entry, leave it blank. Jan. 31 - Select - - Select - - Select - - Select - - Select - - Select - July 1 - Select - - Select - - Select - - Select - - Select - - Select - Aug. 30 - Select - - Select - - Select - - Select - - Select - - Select - - Select - - Select - b. Journalize the December 31 adjusting entry for semiannual interest earned on the bonds. Assume a 360-day year. Do not round interim calculations. Round final answers to nearest dollar. If an amount box does not require an entry, leave it blank. Dec. 31 - Select - - Select - - Select - - Select - c. Journalize the receipt of $24,000 at the bonds’ maturity on July 1. If an amount box does not require an entry, leave it blank. July. 1 - Select - - Select - - Select - - Select -

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The following bond investment transactions were completed by Starks Company:

Jan. 31	Purchased 42, $1,000 government bonds at 100 plus accrued interest of $210 (1 month). The bonds pay 6% annual interest on July 1 and January 1.
July 1	Received semiannual interest on bond investment.
Aug. 30	Sold 18, $1,000 bonds at 98 plus $180 accrued interest (2 months).

a. Journalize the entries for these transactions. Assume a 360-day year. Do not round interim calculations. Round final answers to nearest dollar. If an amount box does not require an entry, leave it blank.

Jan. 31	- Select -	- Select -
	- Select -	- Select -
	- Select -	- Select -
July 1	- Select -	- Select -
	- Select -	- Select -
	- Select -	- Select -
Aug. 30	- Select -	- Select -
	- Select -	- Select -
	- Select -	- Select -
	- Select -	- Select -

b. Journalize the December 31 adjusting entry for semiannual interest earned on the bonds. Assume a 360-day year. Do not round interim calculations. Round final answers to nearest dollar. If an amount box does not require an entry, leave it blank.

Dec. 31		- Select -	- Select -
		- Select -	- Select -

c. Journalize the receipt of $24,000 at the bonds’ maturity on July 1. If an amount box does not require an entry, leave it blank.

July. 1		- Select -	- Select -
		- Select -	- Select -

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