On July 1, 2020, Montana Inc. purchased $200,000 of the 9%, 10 year bonds of...
50.1K
Verified Solution
Link Copied!
Question
Accounting
On July 1, 2020, Montana Inc. purchased $200,000 of the 9%, 10 year bonds of South Dakota Inc. for $176,442 (James will not give you this number on the exam so make sure you figure it out). This investment will provide Montana Inc an effective yield of 11%. Interest is received annually on June 30. The bonds have a fair value of 188,500 on Dec 31, 2020. Montana Inc's year end is December 31, What kind of investment is this? Do we need to make an entry for the $188,500? Yes or no and why? Prepare journal entries for July 1, 2020 and December 31, 2021 and June 30, 2022
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
- Unlimited Question Access with detailed Answers
- Zin AI - 3 Million Words
- 10 Dall-E 3 Images
- 20 Plot Generations
- Conversation with Dialogue Memory
- No Ads, Ever!
- Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Other questions asked by students
StudyZin's Question Purchase
1 Answer
$0.99
(Save $1 )
One time Pay
- No Ads
- Answer to 1 Question
- Get free Zin AI - 50 Thousand Words per Month
Best
Unlimited
$4.99*
(Save $5 )
Billed Monthly
- No Ads
- Answers to Unlimited Questions
- Get free Zin AI - 3 Million Words per Month
*First month only
Free
$0
- Get this answer for free!
- Sign up now to unlock the answer instantly
You can see the logs in the Dashboard.