On January 1, 2016, Marimba Inc. purchased $1,000,000 of Panora Ltd.’s 5% bonds. Marimba paid a commission of $2,000 to the broker who made the purchase. The bonds pay semi-annual interest each 30 June and 31 December and mature on December 31, 2025. The market interest rate was 6% on the date of purchase. Marimba usual approach to this type of investment is to hold it to maturity, earning income from the interest.

Answer rating: 100% (QA)

1 the bond will be recorded at fair value JOURNAL ENTRY 1 1ST JANUARY 2001 CASH BANK AC Dr 1250000 T... View the full answer