Problemon march 1 2016 navy corporation used excess cash to, Ask an Expert

Accounting

Problem

On March 1, 2016, Navy Corporation used excess cash to purchase U.S. Treasury bonds for $112,000 plus accrued interest. The bonds were purchased at face value. The appropriate interest rate is 6%. Interest on these bonds is payable on January 1 and July 1 of each year. Navy's investment is accounted for as held to maturity. The fair value of the Treasury bonds is $113,000 at year-end.

Required:

Prepare the appropriate journal entries to record the transactions for the year, including any year-end adjustments.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M92749953

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