Henry Inc. purchased $10,000 of Container Corporation's 5% bonds at par. The purchase was made on...

 

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Henry Inc. purchased $10,000 of Container Corporation's 5% bonds at par. The purchase was made on January 1, and the investment was classified as a trading security. On June 30, Henry Inc. received semiannual interest of $250. On that date, the fair value of the bonds was $9,600. Prepare Henry's journal entries for (a) the purchase of the investment, (b) the interest received, and (c) the fair value adjustment, assuming that the company is reporting mid-year financial statements. Note: If a line in a journal entry isn't required for the transaction, select "N/A" as the account names and leave the Dr. and Cr. answers blank (zero). Date Account Name a. Jan. 1 Investment in Stock Cash b. June 30 C. June 30 Dr. Cr. 0 0 0 0 0 0 0 0 0 0 0 0 Henry Inc. purchased $10,000 of Container Corporation's 5% bonds at par. The purchase was made on January 1, and the investment was classified as a trading security. On June 30, Henry Inc. received semiannual interest of $250. On that date, the fair value of the bonds was $9,600. Prepare Henry's journal entries for (a) the purchase of the investment, (b) the interest received, and (c) the fair value adjustment, assuming that the company is reporting mid-year financial statements. Note: If a line in a journal entry isn't required for the transaction, select "N/A" as the account names and leave the Dr. and Cr. answers blank (zero). Date Account Name a. Jan. 1 Investment in Stock Cash b. June 30 C. June 30 Dr. Cr. 0 0 0 0 0 0 0 0 0 0 0 0

Answer rating: 100% (QA)

a Purchase of the investment Henry Inc purchased 10000 of Container Corporations 5 bonds at par on J... View the full answer