Kimpler Company purchased $200,000 of the 6%, 10-year bonds of Banks Corporation for $185,788 on 5/2/23,...

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Kimpler Company purchased $200,000 of the 6%, 10-year bonds of Banks Corporation for $185,788 on 5/2/23, which provides a 7% return on semi-annual interest payments made every 5/1 and 11/1. Kimpler does not intend to hold the bonds until maturity, but will hold them for longer than a year. The market value of the bonds at 12/31/23 is $185,400. On 7/1/24, Kimpler sells the bonds (including accrued interest) for $189,750. What journal entries will Kimpler make in 2023 and 2024 to appropriately record these transactions and to report this investment on the year-end financial statements? Besides the purchase on 5/2/23, include the interest payment in 2023, all year-end accruals for 2023, the interest payment for 5/1/24 and the sale on 7/1/24. Kimpler Company purchased $200,000 of the 6%, 10-year bonds of Banks Corporation for $185,788 on 5/2/23, which provides a 7% return on semi-annual interest payments made every 5/1 and 11/1. Kimpler does not intend to hold the bonds until maturity, but will hold them for longer than a year. The market value of the bonds at 12/31/23 is $185,400. On 7/1/24, Kimpler sells the bonds (including accrued interest) for $189,750. What journal entries will Kimpler make in 2023 and 2024 to appropriately record these transactions and to report this investment on the year-end financial statements? Besides the purchase on 5/2/23, include the interest payment in 2023, all year-end accruals for 2023, the interest payment for 5/1/24 and the sale on 7/1/24.

Answer rating: 100% (QA)

Kimpler Company Bond Investment Journal Entries 2023 May 2nd Debit Investment in Bonds Banks Corporation 185788 Credit Cash 185788 To record the purch... View the full answer