Control Group purchased thirty $1,000, 10%, 20-year bonds of Natchez Corporation on January 1, 2012, as a

Question:

Control Group purchased thirty $1,000, 10%, 20-year bonds of Natchez Corporation on January 1, 2012, as a long-term investment. The bonds mature on January 1, 2032, and interest is payable every January 1 and July 1. Control’s reporting year ends December 31, and the company uses the straight-line method of amortizing premiums and discounts. Make all necessary journal entries relating to the bonds for 2012, assuming:

1. The purchase price is 104% of face value.

2. The purchase price is 94% of face value.

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...