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On January 1, 2020 Green Company purchased at par 6% bonds having a maturity value...

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Question

Accounting

On January 1, 2020 Green Company purchased at par 6% bonds having a maturity value of $300,000. They are dated January 1, 2020, and mature January 1, 2025, with interest received January 1 of each year. The bonds are classified in the held -to -maturity category.

Instructions

(a) Prepare the journal entry at the date of the bond purchase.

(b) Prepare the journal entry to record the interest revenue on December 31, 2020.

(c) Prepare the journal to record the interest received January 1, 2021.

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