Graff Corporation purchases $ percent, fiveyear bonds on January with interest payable on July and January The bonds sell for $ which results in a bond premium of $ and an effective interest rate of percent.
A Records the purchase of the bonds on January
B Record interest revenue on July
C Record the interest revenue on December
D Apply the fair value method to these debt securities assume that at December the fair value of the bonds is greater than the carrying amount of the investments. Makes the Fair Value Adjustment Dec. entry.
E Financial Statement Presentation
