Page 1 of 3 1. PE.15-01.ALGO (Algorithmic) Bond Investment Transactions Journali

Question

Page 1 of 3 1. PE.15-01.ALGO (Algorithmic) Bond Investment Transactions Journalize the entries to record the following selected bond investment transactions for Starks Products: For a compound transaction, if an amount box does not require an entry, leave it blank. a. Purchased for cash $84,000 of Iceline, Inc. 9% bonds at 100 plus accrued interest of $1,260, paying interest semiannually. b. Received first semiannual interest payment. c. Sold $56,000 of the bonds at 102 plus accrued interest of $430. 2. PE.15-02 AL GO(Alaorith

Explanation / Answer

a) Invesment in bonds-Iceline Inc 84000 Interest receivable 1260 Cash 85260 b) Cash (84000*9%*1/2) 3780 Interest receivable 1260 Interest income 2520 c) Cash (56000*102%+430) 57550 Interest Income 430 Gain on sale of investments 1120 Investment in bonds-Iceline Inc 56000

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