On January 1, 20x2, Penn Co (parent purchased 90% of the outstanding common shares of Senn Co. (Subsidiary. On January 2. 20x2. Senn Co purchased $20,000 face amount 8% of bond of Penn Co. from outside investors for $18.000 to yleld 10% (market rate) Theses bonds had been issued at per (tace amount $20000) by Penn Co. Senn Co intends to hoid the bonds until maturity Senn Co reported net income of $5.000 and Penn Company reported separate income $8,000 during 20x2. interests are paid annually Senn Co. uses effective interest method for interest income calculation Q1. Please complete the following consolidation entry at December 31, 20x2 Account Debit Credit Bnterest income Bonds payable Interest expense Investment in Penn Bond
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- Bula Investments acquired $260,400 of Effenstein Corp., 10% bonds at their face amount on October 1, 20Y1. The bonds pay interest on October 1 and April 1. On April 1, 20Y2, Bula sold $67,600 of Effenstein Corp. bonds at 103. Required: Journalize the entries to record the following: a. The initial acquisition of the Effenstein Corp. bonds on October 1, 20Y1.* b. The adjusting entry for 3 months of accrued interest earned on the Effenstein Corp. bonds on December 31, 20Y1.* c. The receipt of semiannual interest on April 1, 20Y2.* d. The sale of $67,600 of Effenstein Corp. bonds on April 1, 20Y2, at 103.* e. The receipt of the face value of the remaining bonds at their maturity on October 1, 20Y8.*Gonzalez Company acquired $183,600 of Walker Co., 4% bonds on May 1 at their face amount. Interest is paid semiannually on May 1 and November 1. On November 1, Gonzalez Company sold $43,800 of the bonds for 97. Journalize entries to record the following in Year 1 (refer to the Chart of Accounts for exact wording of account titles): a. The initial acquisition of the bonds on May 1. b. The semiannual interest received on November 1. c. The sale of the bonds on November 1. d. The accrual of $932 interest on December 31.Torres Investments acquired $233,600 of Murphy Corp., 6% bonds at their face amount on October 1, Year 1. The bonds pay interest on October 1 and April 1. On April 1, Year 2, Torres sold $111,200 of Murphy Corp. bonds at 105. Journalize the entries to record the following (refer to the Chart of Accounts for exact wording of account titles): a. The initial acquisition of the Murphy Corp. bonds on October 1, Year 1. b. The adjusting entry for three months of accrued interest earned on the Murphy Corp. bonds on December 31, Year 1. c. The receipt of semiannual interest on April 1, Year 2. d. The sale of $111,200 of Murphy Corp. bonds on April 1, Year 2, at 105.
- On May 1, 20X1, Starlight Company purchased $750,000 of Gazing Corp's 12% bonds at 100 plus accrued interest. On December 31, 20X1, Starlight Co. received its annual interest. On March 31, 20X3, Starlight decided to sell half the bonds to Twinkly Inc. at 99 plus accrued interest. Prepare the journal entries for the following transactions: a. The purchase of the bonds b. The receipt of all interest c. The sale of the bonds to Twinkly Inc.On January 1, 20x1, Eduard Co. acquired 12%, P4,000,000 bonds for P4,198,948. The principal is due on December 31, 20x3 but interest is made annually starting December 31, 20x1. The effective interest rate on the bonds is 10%.13. How much is the interest income recognized in 20x1?a. 419,895b. 413,884c. 407,273d. 480,00014. How much is the carrying amount of the investment on December 31, 20x1?a. 4,198,948b. 4,138,843c. 4,072,727d. 4,000,000On July 1, Year 1, XYZ Corporation purchased as a long-term investment a $2 million face amountABC Co. 6% bond for $2,025,000 plus accrued interest to yield 5.75%. On December 31, Year 1,the bonds had a fair value of $1,850,000. What amount of income should XYZ report on its incomestatement for the year ended December 31, Year 1, related to this bond investment if it is classifiedas a held-to-maturity security?a. $120,000b. $116,438c. $121,500d. $115,000
- On July 1, 20x3, Wenna Inc. purchased as a short-term investment a P 1,000,000 face value Keizen Co. 8% bond for P 910,000 plus accrued interest to yield 10%. The bonds mature on January 1, 20x10, pay interest annually on January 1, and are classified as Debt Investments @ Fair Value through Profit or Loss. On December 31, 20x3, the bonds had a fair value of P 945,000. On February 13, 20x4, Wenna sold the bonds for P 920,000. On July 1, 20x3, how much cash was paid by Wenna Inc. in connection with the purchase of the Debt Investments?Use this information for Pierce Company to answer the question that follow. On May 1, Pierce Company purchased $60,000 of Stanton Company's 12% bonds at 100 plus accrued interest of $2,400. On June 30, Pierce received its first semiannual interest. On February 1, Pierce sold $50,000 of the bonds at 103 plus accrued interest. What are the total proceeds from the February 1 sale? Oa. $51,500 Ob. $50,000 Oc. $52,400 Od. $52,000 ?Pat Inc. purchased the $100.000 face value outstanding bonds of Slinger Company, its 80%-owned subsidiary, fo $101.300 (to yield 7.5% annual interest) on January 1, 20X3. The bonds have a stated nominal interest rate of 8°. The bonds were sold on January 1, 20X1, for $101,005 to yield 7.75% annual interest. The bonds mature on Janu 20X6. The bonds pay interest each January 1. Amortizations of premiums are done using the effective interest "amortization method. Instructions: 1. Prepare the 5-year amortization schedule for the bonds issued by Slinger. 7.75% Interest 2. 3. 4. Date 1/1/X1 1/1/X2 1/1/X3 1/1/X4 1/1/X5 1/1/X6 Payment 8,000 8,000 8,000 8,000 8,000 Prepare the 3-year amortization schedule for the bonds purchased by Pat Inc. Date Payment 7.5% Interest 1/1/X3 1/1/X4 Amortization 1/1/X5 1/1/X6 Amortization 8,000 8,000 8,000 Record the entries made by Slinger in 20X3 relative to the bonds. Record the entries made by Pat Inc. in 20X3 relative to the bonds. Balance 101,005 Balance…
- On January 1, Year 2, Grand Company purchased as held for collection investment P1,000,000 face value of Greek Company’s 8% bonds for P912,400. The bonds were purchased to yield 10% interest. The bonds mature on January 1 Year 7, and pay interest annually on January 1. What amount should Grand Company report on its December 31, Year 2 statement of financial position for held for collection investment?On July 1, 20x1, Santa Co. acquires P2,000,000 face amount, 10% bonds for P2,000,000 and classifies the investment as FVOCI. On Dec. 31, 20x1, the bonds are quoted at 98 and Santa Co. estimates 12-month expected credit losses of P10,000. What amounts (excluding interest) are recognized in profit or loss (P/L) and other comprehensive income (OCI) in 20x1? OCI P/L OCI P/L 10,000 b. 30,000 30,000 10,000 с. 0 40,000 a. d. 40,000 0.Gonzalez Company acquired $210,000 of Walker Co., 5% bonds on May 1 at their face amount. Interest is paid semiannually on May 1 and November 1. On November 1, Gonzalez Company sold $44,400 of the bonds for 95. Journalize entries to record the following in Year 1: For a compound transaction, if an amount box does not require an entry, leave it blank. a. The initial acquisition of the bonds on May 1. May 1 fill in the blank 2db398fc5fbefe9_2 fill in the blank 2db398fc5fbefe9_4 b. The semiannual interest received on November 1. Nov. 1 fill in the blank 12a681fdb06bff7_2 fill in the blank 12a681fdb06bff7_4 c. The sale of the bonds on November 1. Nov. 1 fill in the blank cee7ff00dfa3fc5_2 fill in the blank cee7ff00dfa3fc5_3 fill in the blank cee7ff00dfa3fc5_5 fill in the blank cee7ff00dfa3fc5_6 fill in the blank cee7ff00dfa3fc5_8 fill in the blank cee7ff00dfa3fc5_9 d. The accrual of $1,380…