Wildhorse Company invests $10,400,000 in 4% fixed rate corporate bonds on January 1, 2025. All the...

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Wildhorse Company invests $10,400,000 in 4% fixed rate corporate bonds on January 1, 2025. All the bonds are classified as available-for-sale and are purchased at par. At year-end, market interest rates have declined, and the fair value of the bonds is now $11,092,000. Interest is paid on January 1. Prepare journal entries for Wildhorse Company to (a) record the transactions related to these bonds in 2025, assuming Wildhorse does not elect the fair option; and (b) record the transactions related to these bonds in 2025, assuming that Wildhorse Company elects the fair value option to account for these bonds. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Record journal entries in the order presented in the problem.) Wildhorse Company invests $10,400,000 in 4% fixed rate corporate bonds on January 1, 2025. All the bonds are classified as available-for-sale and are purchased at par. At year-end, market interest rates have declined, and the fair value of the bonds is now $11,092,000. Interest is paid on January 1. Prepare journal entries for Wildhorse Company to (a) record the transactions related to these bonds in 2025, assuming Wildhorse does not elect the fair option; and (b) record the transactions related to these bonds in 2025, assuming that Wildhorse Company elects the fair value option to account for these bonds. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Record journal entries in the order presented in the problem.)

Answer rating: 100% (QA)

Answer a Journal entries for Wildhorse Company in 2025 without electing the fair value option On Jan... View the full answer