On January 1, 2022, Investor Limited Purchased a bond with the following characteristics: - Face...
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Accounting
On January 1, 2022, Investor Limited Purchased a bond with the following characteristics:
- Face Value of $60,000 with a coupon rate of 6% per annum
- Interest Paid semi-annually on June 30 and December 31
- Maturity date: December 31, 2026
The bonds were priced to yield 8%, Investor Limited paid $55,133
At December 31, 2022, the bonds had a fair value of $59,000
Required
- Assume that investor limited decides to account for this bond investment using FVOCI. Prepare the 2022 journal entries related to this bond investment.
- Assume that Investor Limited sells $45,000 face value of the bonds on January 1, 2023. Proceeds from selling these bonds were $44,000. Prepare the journal entry for the sale of the bonds.
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