Business, 05.06.2020 21:06 smariedegray
Mills Corporation acquired as an investment $260 million of 6% bonds, dated July 1, on July 1, 2021. Company management is holding the bonds in its trading portfolio. The market interest rate (yield) was 4% for bonds of similar risk and maturity. Mills paid $300 million for the bonds. The company will receive interest semiannually on June 30 and December 31. As a result of changing market conditions, the fair value of the bonds at December 31, 2021, was $280 million.
Required: 1. & 2. Prepare the journal entry to record Mills' investment in the bonds on July 1, 2021 and interest on December 31, 2021, at the effective (market) rate.
3. Prepare the journal entry by Mills to record any fair value adjustment necessary for the year ended December 31, 2021.
4. Suppose Moody's bond rating agency upgraded the risk rating of the bonds, and Mills decided to sell the investment on January 2, 2022, for $314 million. Prepare the journal entries required on the date of sale.
Answers: 1
Another question on Business
Business, 22.06.2019 19:00
What is an equation of the line in slope intercept formm = 4 and the y-intercept is (0,5)y = 4x-5y = -5x +4y = 4x + 5y = 5x +4
Answers: 1
Business, 22.06.2019 20:40
Consider an economy where the government's budget is initially balanced. the production function, consumption function and investment function can be represented as follows y equals k to the power of alpha l to the power of 1 minus alpha end exponent c equals c subscript 0 plus b left parenthesis y minus t right parenthesis i equals i subscript 0 minus d r suppose that taxes increase. what happens to the equilibrium level of output?
Answers: 1
Business, 23.06.2019 00:30
Emerson has an associate degree based on the chart below how will his employment opportunities change from 2008 to 2018
Answers: 3
Business, 23.06.2019 03:20
Which of the following traits indicate that stephanie is good at time management in her new management role? during the work day, stephanie does not know what to do next. stephanie's work space is crowded and cluttered. stephanie uses breaks during work to see what friends are up to on social media. stephanie keeps a schedule for events, meetings, and deadlines.
Answers: 1
You know the right answer?
Mills Corporation acquired as an investment $260 million of 6% bonds, dated July 1, on July 1, 2021....
Questions
Biology, 16.04.2020 18:02
English, 16.04.2020 18:02
Mathematics, 16.04.2020 18:02
Physics, 16.04.2020 18:02
Spanish, 16.04.2020 18:02
