Carras Corporation purchased $60,000 of five-year, 6% bonds of Hu Inc. for $55,133 to yield an 8%

Question:

Carras purchased $60,000 of five-year, 6% bonds of Hu Inc. for $55,133 to yield an 8% return, and classified the purchase as an amortized cost method investment. The bonds pay interest semi-annually.
(a) Assum1ing Carras applies IFRS, prepare its journal entries for the purchase of the investment and the receipt of semi-annual interest and discount amortization for the first two interest payments that will he received. Round amounts to the nearest dollar.
(b) Assuming Carras applies ASPE and has chosen the straight-line method of discount amortization, prepare the same three entries requested in part (a), rounding amounts to the nearest dollar.
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...