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  3. 1. graff corporation purchases $200,000,10 percent

1. Graff Corporation purchases $200,000,10 percent, five-year bonds on January 1,2019, with interest payable on...

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Accounting

1. Graff Corporation purchases $200,000,10 percent, five-year bonds on January 1,2019, with interest payable on July 1 and January 1. The bonds sell for $208,111, which results in a bond premium of $8,111 and an effective interest rate of 8 percent.
A. Records the purchase of the bonds on January 1,2019
B. Record interest revenue on July 1,2019
C. Record the interest revenue on December 31,2019
D. Apply the fair value method to these debt securities, assume that at December 31,2019 the fair value of the bonds is greater than the carrying amount of the investments. Makes the Fair Value Adjustment Dec. 31,2019, entry.
E. Financial Statement Presentation

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