Reference no: EM132508820

Question a) Prepare journal entries for all dates. Journal entries for the Tempe bonds (a, b, c) Journal Entries for the Flagstaff bonds (d, e, f). No explanations or supporting computations are required. Use straight-line amortization. Do NOT use separate accounts for discounts and premiums; instead, net them into the Investments account. When computing amortization, round the monthly amortization amounts to the nearest cent. However, journal entry amounts can be rounded to the nearest dollar.

The following information relates to the HTM debt securities investments of Kiran Company during 2018:

a) February 1: The company purchased 10% bonds of Tempe Company having a par value of $150,000 at 98 plus accrued interest. Interest is payable January 1 and July 1. Maturity date is 1/1/20.

b) July 1: Semiannual interest is received and amortization is updated for the Tempe bonds.

c) December 31: Interest is accrued and amortization updated for the Tempe bonds.

d) June 1: 9% bonds of Flagstaff were purchased. The bonds had a par value of $80,000 and were purchased at 103 plus accrued interest. Interest dates are January 1 and July 1. Maturity date is 1/1/20.

e) July 1: Semiannual interest is received and amortization updated for the Flagstaff bonds.

f) December 31: Interest is accrued and amortization updated for the Flagstaff bonds.