xy D In Class Assignment McGraw-Hill Echacationc 0.5674850344669542 151070079314

Question

xy D In Class Assignment McGraw-Hill Echacationc 0.5674850344669542 1510700793144 | ezto.mheduca Lance Brothers Enterprises acquired S635000 of 5% bonds, dated July 1, on July 1, 2016, as a long-term investment Management has the positive intent and ability to hold the bonds until maturity. The market interest rate (yeld) was 6% for bonds of smilar risk and maturity Lance Brothers paid S555.000 for the investment in bonds and will receive interest semiannually on June 30 and December 31 Prepare the journal entries (a) to record Lance Brothers investment in the bonds on July 1. 2016, and (b) to record interest on December 31. 2016, at the effective (market) rate. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet Record Lance Brothers' investment in the bonds on July 1, 2016. Note: Enter debits before credits. Event General Journal DebitCredit Record entry Clear entry View general journal tation: 6

Explanation / Answer

Date General journal Debit Credit a Investment in bonds              635,000 Dicount on investment in bonds                80,000 Cash              555,000 [ Discount= 635000-555000] b Cash 15875 635000*5%*6/12 Dicount on investment in bonds 775 Balance Interest revenue 16650 555000*6%*6/12

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