Burt Company had the following transactions and adjustments related to a bond investment: 2019 Jan. 1...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Burt Company had the following transactions and adjustments related to a bond investment: 2019 Jan. 1 June 30 2028 Purchased $750,000 face value of Sphere, Inc.'s 9 percent bonds at 102 plus a brokerage commission of $900. The bonds pay interest on June 30 and December 31 and mature in 10 years. Burt expects to hold the bonds to maturity. Received the semiannual interest payment on the Sphere bonds and amortized the bond premium for six months. Burt uses the straight-line method to amortize bond discounts and premiums. Dec. 31 Received the semiannual interest payment on the Sphere bonds and amortized the bond premium for six months. Dec. 31 Received the principal amount in cash on maturity date of the Sphere bonds. Record the transactions and adjustments of Burt Company using journal entries. General Journal Date Description 1/1/2019 Bond investment-held to maturity (Sphere) ♦ ✓ : ✓ Cash To record purchase of debt securities. 6/30/2019 Cash Bond investment-held to maturity (Sphere) Bond interest income To record receipt of interest income. 12/31/2028 Cash Bond investment-held to maturity (Sphere) Bond interest income To record receipt of interest income. 12/31/2028 Cash Bond investment-held to maturity (Sphere) To record redemption of bonds at maturity. + ✓ + ✓ ÷ ✓ ◆ ✔ Ĉ Debit 0x 0✓ 0x 0✔ 05 ox 0✔ 0✔ 05 Credit 0x OV 0x 0x 0✔ 0x 0x 0✔ 0x Burt Company had the following transactions and adjustments related to a bond investment: 2019 Jan. 1 June 30 2028 Purchased $750,000 face value of Sphere, Inc.'s 9 percent bonds at 102 plus a brokerage commission of $900. The bonds pay interest on June 30 and December 31 and mature in 10 years. Burt expects to hold the bonds to maturity. Received the semiannual interest payment on the Sphere bonds and amortized the bond premium for six months. Burt uses the straight-line method to amortize bond discounts and premiums. Dec. 31 Received the semiannual interest payment on the Sphere bonds and amortized the bond premium for six months. Dec. 31 Received the principal amount in cash on maturity date of the Sphere bonds. Record the transactions and adjustments of Burt Company using journal entries. General Journal Date Description 1/1/2019 Bond investment-held to maturity (Sphere) ♦ ✓ : ✓ Cash To record purchase of debt securities. 6/30/2019 Cash Bond investment-held to maturity (Sphere) Bond interest income To record receipt of interest income. 12/31/2028 Cash Bond investment-held to maturity (Sphere) Bond interest income To record receipt of interest income. 12/31/2028 Cash Bond investment-held to maturity (Sphere) To record redemption of bonds at maturity. + ✓ + ✓ ÷ ✓ ◆ ✔ Ĉ Debit 0x 0✓ 0x 0✔ 05 ox 0✔ 0✔ 05 Credit 0x OV 0x 0x 0✔ 0x 0x 0✔ 0x
Expert Answer:
Answer rating: 100% (QA)
Date Description Bond investmentheld to 01012019 maturitysphere Cash 06302019 Cash Bo... View the full answer
Related Book For
Financial Accounting
ISBN: 9781618533111
6th Edition
Authors: Michelle L. Hanlon, Robert P. Magee, Glenn M. Pfeiffer, Thomas R. Dyckman
Posted Date:
Students also viewed these accounting questions
-
Hartgraves Company had the following transactions and adjustments related to a bond investment that is a trading security. 2018 Oct.1 Purchased $500,000 face value of Skyline, Inc.'s 7% bonds at 97...
-
Barclay, Inc., had the following transactions and adjustments related to a bond investment that is classified as a trading security. 2018 Nov. 1 Purchased $300,000 face value of Joos, Inc.'s 9% bonds...
-
A company had the following transactions during its most recent fiscal period: 1. Paid rent of $39,000 during the year which included $3,000 for the first month of next year. 2. Paid $11,700 of...
-
Nu Company reported the following pretax data for its first year of operations. Net sales 2,930 Cost of goods available for sale 2,420 Operating expenses 750 Effective tax rate 20 % Ending...
-
Orlando and Diego Universities offer executive training courses to corporate clients. Orlando pays its instructors $4,600 per course taught. Diego pays its instructors $230 per student enrolled in...
-
Show that the pure shrinkage estimator (Problem 9.25) is the solution to Data From Problem 9.25 The pure shrinkage estimator is defined as \(\hat{\beta}_{s}=c \hat{\beta}\), were \(0 \leq c \leq 1\)...
-
In September 1990, the chairman of the Securities Exchange Commission criticized carrying investments at amortized cost and argued that, in the banking and savings & loan industries, "serious...
-
Northern Highlands Railroad Company is evaluating three capital investment proposals by using the net present value method. Relevant data related to the proposals are summarized as follows:...
-
The "one-time good deal" Cash-For-Clunkers program offered by the federal government proved a temporary boon for car dealers. In addition to this program, dealers were eager to add their own...
-
Parent Co. owns 75% of Sub Co. and uses the cost method to account for its investment. The following are summarized income statements for the year ended December 31, Year 7. Additional Information: ...
-
Peloton stock just hit its lowest point since March 2020. Here's why the company is in such big trouble. Peloton Inc. is suspending production for several of its at-home fitness products, CNBC...
-
Laker Company reported the following January purchases and sales data for its only product. For specific identification, ending inventory consists of 300 units from the January 30 purchase, 5 units...
-
At December 1, 2020, Waterway Company's accounts receivable balance was $1400. During December, Waterway had credit sales of $7300 and collected accounts receivable of $6200. At December 31, 2020,...
-
1. Prepare a production budget for the first quarter of the year. Show the number of bottles that should be produced each month as well as for the quarter in total. Pets Plus, Inc. Production Budget...
-
c. Sold merchandise to customers who used MasterCard and VISA, $109,440. The cost of the goods sold was $65,660. (Record the sale first.) d. Sold merchandise to customers who used American Express,...
-
William is planning for his retirement this year. One option that has been presented to him is the purchase of an annuity that would provide a $40,000 payment each year for the next 15 years. Click...
-
3. Let u= (1, 2, 3) and v= (2, 3, 4). (a) Find 2u - 3v. (b) Find ||u||. (c) Find a constant c such that u is perpendicular to u + cv.
-
Conduct a VRIO analysis by ranking Husson University (in Maine) business school in terms of the following six dimensions relative to the top three rival schools. If you were the dean with a limited...
-
What are the components of pension expense that is reported in the income statement?
-
Record the effect of each of the following independent transactions using the financial statement effects template provided. Confirm that Assets = Liabilities + Equity. Balance Sheet Income Statement...
-
What are some limitations of consolidated financial statements?
-
A construction engineer has to inspect 5 construction sites in a 2-day inspection schedule. He may or may not be able to visit these sites in two days. He will not visit any site more than once. (a)...
-
An explosion in an LNG storage tank in the process of being repaired could have occurred as the result of static electricity, malfunctioning electrical equipment, an open flame in contact with the...
-
What conditions for the binomial distribution, if any, fail to hold in the following situations? (a) For each of a company's eight production facilities, record whether or not there was an accident...
Study smarter with the SolutionInn App