URCES Exercise 16-3 Flynn Company purchased 70 Rinehart Company 9%, 10-year, $1,

Question

URCES Exercise 16-3 Flynn Company purchased 70 Rinehart Company 9%, 10-year, $1,380 bonds on January 1, 2017, for Flynn Company sold 40 of the bonds for $53,130. pay interest annually on January 1. On January 1, 2018, after receipt of interest, Prepare the journal entries to record the transactions described above. places, Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Record journal entries in the order presented in the problem.) Round answers to O decimal e.g. 15,250. Credit account titles are automatically indented when amount is entered. Debit Credit Date Account Titles and Explanation y Study CTo record receiet of intesres) Jan. 1, 2018 (To record sale of bonds) Click if you would like to Show Work for this question: Open Show Work 28 F4 F6 17 8

Explanation / Answer

Journal entry :

Date account and explanation debit credit jan 1,2017 Debt investment 96600 Cash 96600 (To record investment) Dec 31,2017 Interest receivable (96600*9%) 8694 Interest revenue 8694 (To record accured interest) jan 1,2018 Cash 8694 Interest receivable 8694 (To record interest received) jan 1,2018 Cash 53130 Loss on sale of debt investment 2070 Debt investment (40*1380) 55200 (To record sale of debt investment)

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