Bocelli Co. purchased $162,000 of 4%, 20-year Sanz County bonds on May 11, Year 1, directly from the county, at their face amount plus accrued interest. The bonds pay semiannual interest on April 1 and October 1. On October 31, Year 1, Bocelli Co. sold $30,000 of the Sanz County bonds at 99 plus $100 accrued interest less a $110 brokerage commission.
Provide journal entries for the following (refer to the Chart of Accounts for exact wording of account titles):
|a.||The purchase of the bonds on May 11 plus 40 days of accrued interest; assume a 360-day year.|
|b.||Semiannual interest on October 1.|
|c.||Sale of the bonds on October 31.|
|d.||Adjusting entry for accrued interest of $1,320 on December 31, Year 1. Get Accounting Homework Help Today|