Suppose Jenner and Sons purchases $600,000 of 4.5% annual bonds of McPhee Corporation at face value on
Question:
Suppose
Jenner and Sons
purchases
$600,000
of
4.5%
annual bonds of
McPhee
Corporation at face value on January 1,
2024.
These bonds pay interest on June 30 and December 31 each year. They mature on December 31,
2033.
Jenner
intends to hold the
McPhee
bond investment until maturity.
Read the
requirements
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.
Question content area bottom
Part 1
Requirement 1. Journalize
Jenner and Sons'
transactions related to the bonds for
2024.
(Record debits first, then credits. Select the explanation on the last line of the journal entry table.)
Begin by journalizing
Jenner and Sons'
investment on January 1,
2024.
Date | Accounts and Explanation | Debit | Credit |
2024 | |||
Jan. 1 | |||
Part 2
Next, journalize the receipt of cash interest on June 30,
2024.
Date | Accounts and Explanation | Debit | Credit |
2024 | |||
Jun. 30 | |||
Part 3
Journalize the receipt of cash interest on December 31,
2024.
Date | Accounts and Explanation | Debit | Credit |
2024 | |||
Dec. 31 | |||
Part 4
Requirement 2. Journalize the entry required on the
McPhee
bonds maturity date. (Assume the last interest payment has already been recorded.) (Record debits first, then credits. Select the explanation on the last line of the journal entry table.)
Date | Accounts and Explanation | Debit | Credit |
2033 | |||
Dec. 31 | |||
Horngrens Financial and Managerial Accounting
ISBN: 978-0133866292
5th edition
Authors: Tracie L. Nobles, Brenda L. Mattison, Ella Mae Matsumura