On January 1, 2019, Garfield AG made an investment in 80,000 of the 9%, 5-year bonds of

Question:

On January 1, 2019, Garfield AG made an investment in €80,000 of the 9%, 5-year bonds of Chester for €74,086, which provides an 11% return. Garfield plans to hold these bonds to collect contractual cash flows. Prepare Garfield's journal entries for
(a) The purchase of the investment,
(b) The receipt of annual interest on December 31 and discount amortization.
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...