Business, 11.06.2020 01:57, wade98

Rekya Mart Inc. is a general merchandise retail company that began operations on January 1, Year 1. The following transactions relate to debt investments acquired by Rekya Mart Inc., which has a fiscal year ending on December 31: Year 1
Apr. 1. Purchased $36,000 of Smoke Bay 5%, 10-year bonds at their face amount plus accrued interest of $300. The bonds pay interest semiannually on February 1 and August 1.
May 16. Purchased $116,000 of Geotherma Co. 6%, 12-year bonds at their face amount plus accrued interest of $290. The bonds pay interest semiannually on May 1 and November 1.
Aug. 1. Received semiannual interest on the Smoke Bay bonds.
Sept. 1. Sold $14,400 of Smoke Bay bonds at 104 plus accrued interest of $60.
Nov. 1. Received semiannual interest on the Geotherma Co. bonds.
Dec. 31 Accrued $360 interest on Smoke Bay bonds.
Dec. 31 Accrued $580 interest on Geotherma Co. bonds.
Year 2
Feb. 1. Received semiannual interest on the Smoke Bay bonds.
May 1. Received semiannual interest on the Geotherma Co. bonds.
Required:
1. Journalize the entries to record these transactions. For a compound transaction, if an amount box does not require an entry, leave it blank.
Date Description Debit Credit
Year 1
Apr. 1.
May 16.
Aug. 1.
Sept. 1.
Nov. 1.
Dec. 31 Smoke Bay
Dec. 31 Geotherma Co.
Year 2
Feb. 1.
May 1.
2. If the bond portfolio is classified as available for sale, what impact would this have on financial statement disclosure?
If the bonds are classified as available-for-sale securities, then the portfolio of bonds would need to be adjusted to . This would be accomplished by using a valuation allowance account and account.

Answers: 3

Show answers

Other questions on the subject: Business

Business, 21.06.2019 21:20, nonispn606

20. sinclair company's single product has a selling price of $25 per unit. last year the company reported a profit of $20,000 and variable expenses totaling $180,000. the product has a 40% contribution margin ratio. because of competition, sinclair company will be forced in the current year to reduce its selling price by $2 per unit. how many units must be sold in the current year to earn the same profit as was earned last year? a. 15,000 units b. 12,000 units c. 16,500 units d. 12,960 units

Answers: 1

continue

Business, 22.06.2019 10:00, caz27

Your uncle is considering investing in a new company that will produce high quality stereo speakers. the sales price would be set at 1.5 times the variable cost per unit; the variable cost per unit is estimated to be $75.00; and fixed costs are estimated at $1,200,000. what sales volume would be required to break even, i. e., to have ebit = zero?

Answers: 1

continue

Business, 22.06.2019 13:30, OnWheels

After successfully completing your corporate finance class, you feel the next challenge ahead is to serve on the board of directors of schenkel enterprises. unfortunately, you will be the only person voting for you. the company has 375,000 shares outstanding, and the stock currently sells for $40, if there are four seats in the current election, how much will it cost you to buy a seat?

Answers: 2

continue

Business, 22.06.2019 20:40, ninjaben

On january 1, 2017, pharoah company issued 10-year, $2,020,000 face value, 6% bonds, at par. each $1,000 bond is convertible into 16 shares of pharoah common stock. pharoah’s net income in 2017 was $317,000, and its tax rate was 40%. the company had 97,000 shares of common stock outstanding throughout 2017. none of the bonds were converted in 2017. (a) compute diluted earnings per share for 2017. (round answer to 2 decimal places, e. g. $2.55.) diluted earnings per share

Answers: 3

continue

Do you know the correct answer?

Rekya Mart Inc. is a general merchandise retail company that began operations on January 1, Year 1....