Problem 1

Problem 1. Handong purchased $200,000, face interest of 9 percent, five-year bonds on January 1,2021, with interest payable on January 1. The bonds sell for $185,216, which results in a bond discount of S14,784 and an effective-interest rate of 11 percent. Handong bought the bond for held-for-collectioin and selling purpose. (20 points) 1. Make journal entry of the debt investment 2. Make a schedule of bond discount amortization from investor perspective, not issuer pespective Interest in Cash Interest Revenue Amortization Carry Book Value Issuance 2021 2022 2023 3. Make a journal entry for interest revenue recognitionat December 31, 2021 4. Fair value of the bond as of December 31, 2021 was $185,000. Make a journal entry for the bond assuming this is a portfolio 5. Make a journal entry for interest revenue recognitionat December 31, 2022. 6. Fair value of the bond as of December 31, 2022 was $192,000. Make a journal entry for the bond assuming this is a portfolio 7. The bond was sold on July 1, 2022 at $190,000 excluding interest revenue. Make a journal entry