Kalyagin Investments acquired $220,000 of Jerris Corp., 7% bonds at their face amount on October...

Question:

Kalyagin Investments acquired $220,000 of Jerris Corp., 7% bonds at their face amount on October 1, 2016. The bonds pay interest on October 1 and April 1.

On April 1, 2017, Kalyagin sold $80,000 of Jerris Corp. bonds at 103.

Journalize the entries to record the following

(refer to the Chart of Accounts for exact wording of account titles and be sure to enter the year as part of the date):

Investment in Bonds

Investment in Bonds is one of the investment in securities that a company can include in assets. There are two ways that a company can earn from these investments. First is the payment of interest in these bonds at a stated interest rate. Second is the gains that they could earn if they sell the bonds at a price higher than what they paid for.

Answer and Explanation:

The following are the journal entries for the transactions given above. Take note that the December 31, 2016 transaction is for the accrual of...

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