Recall 3 year-old Manny, at the beginning of the chapter, who has & a seizure disorder. He receives his care in a mobile van sent to his community by the….
What classification would Imperial Mark use to report this investment?
On March 1, Imperial Mark Co. purchased 5% bonds with a face value of $20,000 for trading purposes. The bonds were priced in the trading markets at 101 to yield 4.87%, at the time of the purchase, and pay interest annually each July 1. At year-end on December 31, the bonds had a fair value of $21,000. Imperial Mark follows IFRS
a. What classification would Imperial Mark use to report this investment?
b. Prepare the journal entries for the bond purchase, the first interest payment, and any year-end adjusting entries required. Round amounts to the nearest whole dollar.
c. Assume now that Imperial Mark follows ASPE. How would Imperial Mark classify and report this investment? Prepare the journal entries from part (b) using the ASPE classification and the alternate method to amortize the premium. Assume that bond investment matures in ten years.