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Gillooly Co. purchased $78,000 of 7%, 10-year Lumpkin County bonds on May 11, Year 1, directly from the county, at their face amount plus accrued interest. The bonds pay semiannual interest on April 1 and October 1. On October 31, Year 1, Gillooly Co. sold $30,000 of the Lumpkin County bonds at 101 plus $175 accrued interest less a $335 brokerage commission. Journalize the entries to record the following: Do not round interim calculations. Round final answers to nearest dollar. If an amount box does not require an entry, leave it blank. Assume a 360-day year. a. The purchase of the bonds on May 11 plus 40 days of accrued interest. Year 1 May 11 b. Semiannual interest on October 1. Year 1 Oct. 1 c. Sale of the bonds on October 31. Year 1 Oct. 31

Gillooly Co. purchased $78,000 of 7%, 10-year Lumpkin County bonds on May 11, Year 1, directly from the county, at their face amount plus accrued interest. The bonds pay semiannual interest on April 1 and October 1. On October 31, Year 1, Gillooly Co. sold $30,000 of the Lumpkin County bonds at 101 plus $175 accrued interest less a $335 brokerage commission. Journalize the entries to record the following: Do not round interim calculations. Round final answers to nearest dollar. If an amount box does not require an entry, leave it blank. Assume a 360-day year. a. The purchase of the bonds on May 11 plus 40 days of accrued interest. Year 1 May 11 b. Semiannual interest on October 1. Year 1 Oct. 1 c. Sale of the bonds on October 31. Year 1 Oct. 31

Financial Accounting
Financial Accounting
14th Edition
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Carl Warren, Jim Reeve, Jonathan Duchac
Chapter15: Investments And Fair Value Accounting
Section: Chapter Questions
Problem 1E: Parilo Company acquired 170,000 of Makofske Co., 5% bonds on May 1, 2016, at their face amount....
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Gillooly Co. purchased $78,000 of 7%, 10-year Lumpkin County bonds on May 11, Year 1, directly from the county, at their face amount plus accrued interest. The bonds pay semiannual interest on April 1 and October 1. On October 31, Year 1, Gillooly Co. sold $30,000 of the Lumpkin County bonds at 101 plus $175 accrued interest less a $335 brokerage commission. Journalize the entries to record the following: Do not round interim calculations. Round final answers to nearest dollar. If an amount box does not require an entry, leave it blank. Assume a 360-day year. a. The purchase of the bonds on May 11 plus 40 days of accrued interest. Year 1 May 11 b. Semiannual interest on October 1. Year 1 Oct. 1 c. Sale of the bonds October 31. Year 1 Oct. 31 100
Transcribed Image Text:Gillooly Co. purchased $78,000 of 7%, 10-year Lumpkin County bonds on May 11, Year 1, directly from the county, at their face amount plus accrued interest. The bonds pay semiannual interest on April 1 and October 1. On October 31, Year 1, Gillooly Co. sold $30,000 of the Lumpkin County bonds at 101 plus $175 accrued interest less a $335 brokerage commission. Journalize the entries to record the following: Do not round interim calculations. Round final answers to nearest dollar. If an amount box does not require an entry, leave it blank. Assume a 360-day year. a. The purchase of the bonds on May 11 plus 40 days of accrued interest. Year 1 May 11 b. Semiannual interest on October 1. Year 1 Oct. 1 c. Sale of the bonds October 31. Year 1 Oct. 31 100
Year 1 Oct. 1 c. Sale of the bonds on October 31. Year 1 Oct. 31 d. Adjusting entry for accrued interest on December 31, Year 1. 88 Year 1 Dec. 31 е. receipt th alue remaining bonds at their maturity on April 1, Year 20. Year 20 Apr. 1 Droviouo
Transcribed Image Text:Year 1 Oct. 1 c. Sale of the bonds on October 31. Year 1 Oct. 31 d. Adjusting entry for accrued interest on December 31, Year 1. 88 Year 1 Dec. 31 е. receipt th alue remaining bonds at their maturity on April 1, Year 20. Year 20 Apr. 1 Droviouo
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Step 1 General Introduction

Journal entries are entered in account books to record each and every financial transaction related to business. These transactions are then entered into ledger accounts to prepare financial statements of the company. Journal entries can be completed only when there is both debit and credit balances.

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