Assume that the fair value of the bonds at December 31, 2008, was $2,200,000. These bonds are classified as available-for-sale securities. Prepare the adjusting entry to record these bonds at fair value.
P13-1A DAVISON CARECENTERS INC. PROVIDES FINANCING AND CAPITAL TO THE HEALTH-CARE INDUSTRY, WITH A…
We Write Essays for Students
Tell us about your assignment and we will find the best writer for your paper
Get Help Now!Problem 13-1A (P13-1A)Davison
Carecenters Inc. provides financing and capital to the health-care
industry, with a particular focus on nursing homes for the elderly. The
following selected transactions relate to bonds acquired as an
investment by Davison, whose fiscal year ends on December 31.
2008
Jan.
1 Purchased at par $2,000,000 of Hannon Nursing Centers, Inc., 10-year,
8% bonds dated January 1, 2008, directly from Hannon.
July 1 Received the semiannual interest on the Hannon bonds.
Dec. 31 Accrual of interest at year-end on the Hannon bonds.
(Assume
that all intervening transactions and adjustments have been properly
recorded and that the number of bonds owned has not changed from
December 31, 2008, to December 31, 2010.)
2011
Jan. 1 Received the semiannual interest on the Hannon bonds.
Jan. 1 Sold $1,000,000 Hannon bonds at 106. The broker deducted $6,000 for commissions and fees on the sale.
July 1 Received the semiannual interest on the Hannon bonds.
Dec. 31 Accrual of interest at year-end on the Hannon bonds.
Instruction
1. Journalize the listed transactions for the years 2008 and 2011.
2.
Assume that the fair value of the bonds at December 31, 2008, was
$2,200,000. These bonds are classified as available-for-sale securities.
Prepare the adjusting entry to record these bonds at fair value.
3.
Based on your analysis in part (b) of the question, show the balance
sheet presentation of the bonds and interest receivable at December 31,
2008. Assume the investments are considered long-term.
PLACE THIS ORDER OR A SIMILAR ORDER WITH TODAY AND GET AN AMAZING DISCOUNT
The post Assume that the fair value of the bonds at December 31, 2008, was $2,200,000. These bonds are classified as available-for-sale securities. Prepare the adjusting entry to record these bonds at fair value. appeared first on Nursing Nursing.
Welcome to originalessaywriters.com, our friendly and experienced essay writers are available 24/7 to complete all your assignments. We offer high-quality academic essays written from scratch to guarantee top grades to all students. All our papers are 100% plagiarism-free and come with a plagiarism report, upon request
Tell Us “Write My Essay for Me” and Relax! You will get an original essay well before your submission deadline.
