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What is the new cost basis of the municipal bonds

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Reference no: EM132538391

Question - Tamarisk Corporation has municipal bonds classified as a held-to-maturity at December 31, 2017. These bonds have a par value of $732,000, an amortized cost of $732,000, and a fair value of $648,000. The company believes that impairment accounting is now appropriate for these bonds.

Required -

Prepare the journal entry to recognize the impairment.

What is the new cost basis of the municipal bonds?

At December 31, 2018, the fair value of the municipal bonds is $692,000. Prepare the entry (if any) to record this information.

Reference no: EM132538391

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