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What amount is the total income to be recognized

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Question - Shelley Corporation acquired $6,000,000 of Zogie Inc.'s 12% bonds on May 1, 2020 at 94 plus accrued interest to be held as financial asset at amortized cost. The bonds pay interest semiannually on February 1 and August 1, and mature on February 1, 2024. The fiscal period for Shelley Corporation is the calendar period. Amortization is done following the straight line method. On May 1, 2022, Shelley Corporation sold all the bonds at 105 plus accrued interest.

a. What amount is the total income to be recognized in the Income Statement for 2021?

b. On December 31, 2021, what amount is the balance of investment to be presented in the Statement of Financial Position?

c. What amount is the total income to be recognized in the 2022 Income Statement?

Reference no: EM132904552

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