Accounting for debt investments</b></p><p>League Up & Co. owns vast amounts of corporate bonds. Suppose League Up buys $900,000 of CocoCorp bonds at face value on January 2, 2018. The CocoCorp bonds pay interest at the annual rate of 8% on June 30 and December 31 and mature on December 31, 2022. League Up intends to hold the investment until maturity.RequirementsHow would the bond investment be classified on League up’s December 31, 2018, balance sheet?Journalize the following on League Up’s books:Receipt of final interest payment, on December 31, 2022. Disposition of the investment at maturity on December 31, 2022.

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Asked Jan 12, 2020
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Accounting for debt investments</b></p><p>League Up &amp; Co. owns vast amounts of corporate bonds. Suppose League Up buys $900,000 of CocoCorp bonds at face value on January 2, 2018. The CocoCorp bonds pay interest at the annual rate of 8% on June 30 and December 31 and mature on December 31, 2022. League Up intends to hold the investment until maturity.

Requirements

  1. How would the bond investment be classified on League up’s December 31, 2018, balance sheet?
  2. Journalize the following on League Up’s books:
  3. Receipt of final interest payment, on December 31, 2022. Disposition of the investment at maturity on December 31, 2022.
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Expert Answer

Step 1
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Step 2
  1. Describe the way in which the bond investment would be classified on League up’s December 31, 2018, balance sheet:
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Step 3

Explanation:&...

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