Flounder Corp. purchased a $100,000 face-value bond of Myers Corp. on August 31, 2019, for $104,490...

 

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Flounder Corp. purchased a $100,000 face-value bond of Myers Corp. on August 31, 2019, for $104,490 plus accrued interest. The effective yield on the bond is 11.02%. The bond pays interest annually each November 1 at a rate of 12%. On November 1, 2019, Flounder Corp. received the annual interest. On December 31, 2019, Flounder's year end, the fair value for these bonds was 103.8. Flounder sold the bond on January 15, 2020, for $103,500 plus accrued interest. Assume Flounder Corp. follows IFRS. Prepare the journal entries to record the purchase of the bond, the receipt of interest, any adjustments required at year end, and the subsequent sale of the bond. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Compute accrued interest using 1/2 month.) Date Account Titles and Explanation Debit Credit Aug. 31, 2019 How many months was the bond held for by Flounder Corp. in 2019? Based on this, how much of the income reported on this bond should be for interest received? Number of months months Interest received 2$ eTextbook and Media List of Accounts How much return did Flounder Corp. earn while the bond was held? Overall return earned on bonds $ eTextbook and Media List of Accounts If this bond had been acquired to earn a return on excess funds, did the company meet its objective? eTextbook and Media List of Accounts Flounder Corp. purchased a $100,000 face-value bond of Myers Corp. on August 31, 2019, for $104,490 plus accrued interest. The effective yield on the bond is 11.02%. The bond pays interest annually each November 1 at a rate of 12%. On November 1, 2019, Flounder Corp. received the annual interest. On December 31, 2019, Flounder's year end, the fair value for these bonds was 103.8. Flounder sold the bond on January 15, 2020, for $103,500 plus accrued interest. Assume Flounder Corp. follows IFRS. Prepare the journal entries to record the purchase of the bond, the receipt of interest, any adjustments required at year end, and the subsequent sale of the bond. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Compute accrued interest using 1/2 month.) Date Account Titles and Explanation Debit Credit Aug. 31, 2019 How many months was the bond held for by Flounder Corp. in 2019? Based on this, how much of the income reported on this bond should be for interest received? Number of months months Interest received 2$ eTextbook and Media List of Accounts How much return did Flounder Corp. earn while the bond was held? Overall return earned on bonds $ eTextbook and Media List of Accounts If this bond had been acquired to earn a return on excess funds, did the company meet its objective? eTextbook and Media List of Accounts

Answer rating: 100% (QA)

Flounder Corp Journal Enteries Requirement b c Date Particulars Debit in Credit in 3182019 FVNI Inve... View the full answer