Information about intermediate accounting

Assignment Help Accounting Basics

Reference no: EM1364691

Scenario:

My Client Ricky Gervais has come to my office with the following information:

1. On February 1, the company purchased 12% bonds of Melissa McCarthy Co. having a par value of $500,000 at 100 plus accrued interest. Interest is payable April 1 and October 1.

2. On April 1, semiannual interest is received.

3. On July 1, 9% bonds of Justin Bieber , Inc. were purchased. These bonds with a par value of $200,000 were purchased at 100 plus accrued interest. Interest dates are June 1 and December 1.

4. On September 1, bonds with a par value of $100,000, purchased on February 1, are sold at 99 plus accrued interest.

5. On October 1, semiannual interest is received.

6. On December 1, semiannual interest is received.

7. On December 31, the fair value of the bonds purchased February 1 and July 1 are 95 and 93, respectively.

I need some help completing the following:

a. Prepare any journal entries you consider necessary, including year-end entries (December 31), assuming these are available-for-sale securities.

b. If Ricky Gervais classified these as held-to-maturity securities, explain how the journal entries would differ from those in part (a).

Reference no: EM1364691

Questions Cloud

Federal income tax liability for pace : Pace Corporation had a taxable income of $300,000 in 2010. They had a taxable income of $1,200,000 in 2011. What is their federal income tax liability for the company for each year?

Network ids diagram of lan depiting two new network : Subnet a class C network into subnets using 2 of the resulting new Network IDs Diagram a woring LAN depiting the two newnetworks.

Elements of emotional intelligence : One of the five elements of emotional intelligence is self-awareness. What behaviors would someone with strong self-awareness demonstrate within the context of leading and managing groups? Provide an example.

Show internal factor evaluation matrix for mcdonalds : Prepare an IFE Matrix for McDonalds. Summarize your observations, including strategic implications as a result of the IFE and Financial Ratio analysis.

Information about intermediate accounting : Prepare any journal entries you consider necessary, including year-end entries (December 31), assuming these are available-for-sale securities.

Service efforts and accomplishments : Why are measures of "service efforts and accomplishments" of more concern in government and not-for-profits than in businesses?

Compute cpi of processor with given workload : Assume that there are no other hazards that require stalling. Compute the CPI of the above processor with the given workload.

Illustrate are lans a stable technology : Are LANs a stable technology or are they changing just as quickly as other forms of communication technologies? Should software licenses be dropped completely?

Minimizing errors in projections : Break even analysis utilizes both current and projected figures. In a rapidly changing economy, there are many individuals who are finding that their initial break even analyses were incorrect.

User Account

All Pages