On January 1, 2023, Pluto Corp. which follows ASPE acquired 8%,$1,000,000 (face value) bonds of...
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On January 1, 2023, Pluto Corp. which follows ASPE acquired 8%,$1,000,000 (face value) bonds of Uranus Ltd., to yield 10%. The bonds were dated January 1, 2023, and mature on December 31,2028 , with interest payable each January 1 . Pluto intends to hold the bonds to maturity and will use the FV-NI model and the effective interest method of amortization of bond premium or discount. Instructions Prepare the following entries in Pluto's books: a) Acquisition of bonds on January 1, 2023, b) Year-end adjusting entry at December 31, 2023, c) Receipt of the first interest payment on January 1, 2024. Round all values to the nearest dollar
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On January 1, 2023, Pluto Corp. which follows ASPE acquired 8%,$1,000,000 (face value) bonds of Uranus Ltd., to yield 10%. The bonds were dated January 1, 2023, and mature on December 31,2028 , with interest payable each January 1 . Pluto intends to hold the bonds to maturity and will use the FV-NI model and the effective interest method of amortization of bond premium or discount. Instructions Prepare the following entries in Pluto's books: a) Acquisition of bonds on January 1, 2023, b) Year-end adjusting entry at December 31, 2023, c) Receipt of the first interest payment on January 1, 2024. Round all values to the nearest dollar 