Burt Company had the following transactions and adjustments related to a bond investment: 2019 Jan. 1...

 

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Burt Company had the following transactions and adjustments related to a bond investment: 2019 Jan. 1 June 30 2028 Purchased $750,000 face value of Sphere, Inc.'s 9 percent bonds at 102 plus a brokerage commission of $900. The bonds pay interest on June 30 and December 31 and mature in 10 years. Burt expects to hold the bonds to maturity. Received the semiannual interest payment on the Sphere bonds and amortized the bond premium for six months. Burt uses the straight-line method to amortize bond discounts and premiums. Dec. 31 Received the semiannual interest payment on the Sphere bonds and amortized the bond premium for six months. Dec. 31 Received the principal amount in cash on maturity date of the Sphere bonds. Record the transactions and adjustments of Burt Company using journal entries. General Journal Date Description 1/1/2019 Bond investment-held to maturity (Sphere) ♦ ✓ : ✓ Cash To record purchase of debt securities. 6/30/2019 Cash Bond investment-held to maturity (Sphere) Bond interest income To record receipt of interest income. 12/31/2028 Cash Bond investment-held to maturity (Sphere) Bond interest income To record receipt of interest income. 12/31/2028 Cash Bond investment-held to maturity (Sphere) To record redemption of bonds at maturity. + ✓ + ✓ ÷ ✓ ◆ ✔ Ĉ Debit 0x 0✓ 0x 0✔ 05 ox 0✔ 0✔ 05 Credit 0x OV 0x 0x 0✔ 0x 0x 0✔ 0x Burt Company had the following transactions and adjustments related to a bond investment: 2019 Jan. 1 June 30 2028 Purchased $750,000 face value of Sphere, Inc.'s 9 percent bonds at 102 plus a brokerage commission of $900. The bonds pay interest on June 30 and December 31 and mature in 10 years. Burt expects to hold the bonds to maturity. Received the semiannual interest payment on the Sphere bonds and amortized the bond premium for six months. Burt uses the straight-line method to amortize bond discounts and premiums. Dec. 31 Received the semiannual interest payment on the Sphere bonds and amortized the bond premium for six months. Dec. 31 Received the principal amount in cash on maturity date of the Sphere bonds. Record the transactions and adjustments of Burt Company using journal entries. General Journal Date Description 1/1/2019 Bond investment-held to maturity (Sphere) ♦ ✓ : ✓ Cash To record purchase of debt securities. 6/30/2019 Cash Bond investment-held to maturity (Sphere) Bond interest income To record receipt of interest income. 12/31/2028 Cash Bond investment-held to maturity (Sphere) Bond interest income To record receipt of interest income. 12/31/2028 Cash Bond investment-held to maturity (Sphere) To record redemption of bonds at maturity. + ✓ + ✓ ÷ ✓ ◆ ✔ Ĉ Debit 0x 0✓ 0x 0✔ 05 ox 0✔ 0✔ 05 Credit 0x OV 0x 0x 0✔ 0x 0x 0✔ 0x

Answer rating: 100% (QA)

Date Description Bond investmentheld to 01012019 maturitysphere Cash 06302019 Cash Bo... View the full answer