On January 1, 2020, Growth Inc. (Growth) purchased, in US funds, $500,000 of bonds of Big Company (Big). On that date, the bonds were trading at par. These bonds pay 10% interest annually each December 31. The bonds mature on December 31, 2022. The following exchange rates were applicable between 2020 and 2022. The following are the relevant foreign exchange rates: January 1, 2020 US$1 = CDN$1.5254 Average rate for 2020 US$1 = CDN $1.5140 December 31, 2020 US$1 = CDN $1.4725 Average rate for 2021 US$1 = CDN $1.4600 December 31, 2021 US$1 = CDN $1.4425 Average rate for 2022 US$1 = CDN $1.4500 %3D December 31, 2022 US$1 = CDN $1.4575 Prepare Growth's journal entries for each of 2020, 2021 and 2022.
On January 1, 2020, Growth Inc. (Growth) purchased, in US funds, $500,000 of bonds of Big Company (Big). On that date, the bonds were trading at par. These bonds pay 10% interest annually each December 31. The bonds mature on December 31, 2022. The following exchange rates were applicable between 2020 and 2022. The following are the relevant foreign exchange rates: January 1, 2020 US$1 = CDN$1.5254 Average rate for 2020 US$1 = CDN $1.5140 December 31, 2020 US$1 = CDN $1.4725 Average rate for 2021 US$1 = CDN $1.4600 December 31, 2021 US$1 = CDN $1.4425 Average rate for 2022 US$1 = CDN $1.4500 %3D December 31, 2022 US$1 = CDN $1.4575 Prepare Growth's journal entries for each of 2020, 2021 and 2022.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter13: Investments And Long-term Receivables
Section: Chapter Questions
Problem 3MC: On July 1, 2019, Aldrich Company purchased as an available-for-sale security 200,000 face value, 9%...
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