Indigo Corporation has municipal bonds classified as a held-to-maturity at December 31,2025. These bonds have...
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Indigo Corporation has municipal bonds classified as a heldtomaturity at December These bonds have a par value of $ an amortized cost of $ and a fair value of $ The company believes that impairment accounting is now appropriate for these bonds. a Correct Answer Used Prepare the journal entry to recognize the impairment. List debit entry before credit entry. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select No Entry" for the account titles and enter O for the amounts. Account Titles and Explanation Credit Bad Debt Expense Allowance for Doubtful Accounts b What is the new carrying value of the municipal bonds? New carrying value $ Given that the maturity value of the bonds is $ should Indigo Corporation amortize the difference between the carrying amount and the maturity value over the life of the bonds? 
Indigo Corporation has municipal bonds classified as a heldtomaturity at December These bonds have a par value of
$ an amortized cost of $ and a fair value of $ The company believes that impairment accounting is now
appropriate for these bonds.
a
Correct Answer Used
Prepare the journal entry to recognize the impairment. List debit entry before credit entry. Credit account titles are automatically
indented when amount is entered. Do not indent manually. If no entry is required, select No Entry" for the account titles and enter O for the
amounts.
Account Titles and Explanation
Credit
Bad Debt Expense
Allowance for Doubtful Accounts
b
What is the new carrying value of the municipal bonds?
New carrying value $
Given that the maturity value of the bonds is $ should Indigo Corporation amortize the difference between the carrying
amount and the maturity value over the life of the bonds?
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