Soto Industries Inc. is an athletic footware company that began operations on January 1, Year 1. The following transactions relate to debt investments acquired by Soto Industries Inc., which has a fiscal year ending on December 31: Year 1 Apr. 1. Purchased $100,000 of Welch Co. 6%, 15-year bonds at their face amount plus accrued interest of $500. The bonds pay interest semiannually on March 1 and September 1. June 1. Purchased $210,000 of Bailey 4%, 10-year bonds at their face amount plus accrued interest of $700. The bonds pay interest semiannually on May 1 and November 1. Sept. 1. Received semiannual interest on the Welch Co. bonds. 30. Sold $40,000 of Welch Co. bonds at 97 plus accrued interest of $200. Nov. 1. Received semiannual interest on the Bailey bonds. Dec. 31. Accrued $1,200 interest on the Welch Co. bonds. 31. Accrued $1,400 interest on the Bailey bonds. Year 2 Mar. 1. Received semiannual interest on the Welch Co. bonds. May 1. Received semiannual interest on the Bailey bonds. Instructions 1. Journalize the entries to record these transactions.
Soto Industries Inc. is an athletic footware company that began operations on January 1, Year 1. The following transactions relate to debt investments acquired by Soto Industries Inc., which has a fiscal year ending on December 31: Year 1 Apr. 1. Purchased $100,000 of Welch Co. 6%, 15-year bonds at their face amount plus accrued interest of $500. The bonds pay interest semiannually on March 1 and September 1. June 1. Purchased $210,000 of Bailey 4%, 10-year bonds at their face amount plus accrued interest of $700. The bonds pay interest semiannually on May 1 and November 1. Sept. 1. Received semiannual interest on the Welch Co. bonds. 30. Sold $40,000 of Welch Co. bonds at 97 plus accrued interest of $200. Nov. 1. Received semiannual interest on the Bailey bonds. Dec. 31. Accrued $1,200 interest on the Welch Co. bonds. 31. Accrued $1,400 interest on the Bailey bonds. Year 2 Mar. 1. Received semiannual interest on the Welch Co. bonds. May 1. Received semiannual interest on the Bailey bonds. Instructions 1. Journalize the entries to record these transactions.
Financial Accounting
15th Edition
ISBN:9781337272124
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter15: Investments And Fair Value Accounting
Section: Chapter Questions
Problem 1PA: Soto Industries Inc. is an athletic footware company that began operations on January 1, Year 1. The...
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