Q8 The following are investment activities for Moko Company.1) On January 31, 2020, Moko Company purchased a $21,600, 10-year bond at par with 5% interest paid annuallyon December 31. Moko Company is planning to hold this investment until maturity.2) On February 10, 2020, Moko Company invested $16,200 in Blast Company by purchasing 2,700 common shares.This is an insignificant investment in Blast Company with the intention of selling it within a year.3) On March 1, 2020, Moko Company made an investment of $119,600 in Elgin Company by acquiring 5% of its184,000 outstanding common shares. Moko Company plans to hold on to these shares for at least a few years.4) On April 1, 2020, Moko Company received a cash dividend from Blast Company for a total of $1,100.5) On April 30, 2020, Moko Company received a cash dividend from Elgin Company for a total of $1,600.6) On Moko Company's year-end of October 31, 2020, Blast Company's common shares were trading at $7.00 pershare, and Elgin Company's shares were trading at $12.00 per share.RequiredPrepare journal entries using proper accounting methods for all transactions including the year end accrual of thebonds' interest.Do not enter dollar signs or commas in the input boxes.Round all answers to the nearest whole number.CreditDebitAccount Title and ExplanationDateJan 3163°to search Jan 31To record purchase of bonds at parFeb 10To record purchase of common shares as a short-term investmentMar 1To record investment of common sharesor 1To record dividends received

Journal entries refers to the official book of a company which is used to record the day to day…

Answered: Required Prepare journal entries using…

Required Prepare journal entries using proper accounting methods for all transactions including the year end accrual of the- bonds' interest.

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 1E

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Question

The following are investment activities for Moko Company.
1) On January 31, 2020, Moko Company purchased a $21,600, 10-year bond at par with 5% interest paid annually
on December 31. Moko Company is planning to hold this investment until maturity.
2) On February 10, 2020, Moko Company invested $16,200 in Blast Company by purchasing 2,700 common shares.
This is an insignificant investment in Blast Company with the intention of selling it within a year.
3) On March 1, 2020, Moko Company made an investment of $119,600 in Elgin Company by acquiring 5% of its
184,000 outstanding common shares. Moko Company plans to hold on to these shares for at least a few years.
4) On April 1, 2020, Moko Company received a cash dividend from Blast Company for a total of $1,100.
5) On April 30, 2020, Moko Company received a cash dividend from Elgin Company for a total of $1,600.
6) On Moko Company's year-end of October 31, 2020, Blast Company's common shares were trading at $7.00 per
share, and Elgin Company's shares were trading at $12.00 per share.
Required
Prepare journal entries using proper accounting methods for all transactions including the year end accrual of the
bonds' interest.
Do not enter dollar signs or commas in the input boxes.
Round all answers to the nearest whole number.
Credit
Debit
Account Title and Explanation
Date
Jan 31
63°
to search

Jan 31
To record purchase of bonds at par
Feb 10
To record purchase of common shares as a short-term investment
Mar 1
To record investment of common shares
or 1
To record dividends received

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