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  • Flexible Company Debit Credit 2020

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    Anonn
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    The company invested $5,241,500 in bonds in January 2020 and earned $600,000 in interest income in December 2020 from the bonds. It also amortized $75,850 in bond premium. In 2021 it had $4,000,000 invested in bonds and earned $480,000 in interest income while amortizing $63,435 in bond premium. It withdrew $1,000,000 from its bond investments each year.

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    Intermediate Accounting1

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    20-5

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    The company invested $5,241,500 in bonds in January 2020 and earned $600,000 in interest income in December 2020 from the bonds. It also amortized $75,850 in bond premium. In 2021 it had $4,000,000 invested in bonds and earned $480,000 in interest income while amortizing $63,435 in bond premium. It withdrew $1,000,000 from its bond investments each year.

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    Download as XLSX, PDF, TXT or read online from Scribd
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    85 views1 page

    Flexible Company Debit Credit 2020

    Uploaded by

    Anonn
    The company invested $5,241,500 in bonds in January 2020 and earned $600,000 in interest income in December 2020 from the bonds. It also amortized $75,850 in bond premium. In 2021 it had $4,000,000 invested in bonds and earned $480,000 in interest income while amortizing $63,435 in bond premium. It withdrew $1,000,000 from its bond investments each year.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
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    of 1

    Flexible Company

    Debit Credit
    2020
    Jan-01 Investment in bonds 5,241,500
    Cash 5,241,500

    Dec-31 Cash (5,000,000 x 12%) 600,000


    Interest income 600,000

    Dec-31 Interest income 75,850


    Investment in bonds 75,850

    Interest received 600,000


    Interest income (10% x 5,241,500) 524,150
    Premium amortization 75,850

    Dec-31 Cash 1,000,000


    Investment in bonds 1,000,000

    2021
    Dec-31 Cash (4,000,000 x 12%) 480,000
    Interest income 480,000

    31 Interest income 63,435 7pts


    Investment in bonds 63,435

    Interest received 480,000


    Interest income (10% x 4,165,650) 416,565
    Premium amortization 63,435

    31 Cash 1,000,000
    Investment in bonds 1,000,000

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