User Account

All Pages

Prepare additional journal entry necessary for tanner-unf

Assignment Help Accounting Basics
Reference no: EM132680746

Question - Tanner-UNF Corporation acquired as a long-term investment $240 million of 8% bonds, dated July 1, on July 1, 2021. Company management has classified the bonds as an available-for-sale investment. The market interest rate (yield) was 10% for bonds of similar risk and maturity. Tanner-UNF paid $200 million for the bonds. The company will receive interest semiannually on June 30 and December 31. As a result of changing market conditions, the fair value of the bonds at December 31, 2021, was $210 million.

Required -

1. & 2. Prepare the journal entry to record Tanner-UNF's investment in the bonds on July 1, 2021 and interest on December 31, 2021, at the effective (market) rate.

3. Prepare any additional journal entry necessary for Tanner-UNF to report its investment in the December 31, 2021, balance sheet.

4. Suppose Moody's bond rating agency downgraded the risk rating of the bonds motivating Tanner-UNF to sell the investment on January 2, 2022, for $180 million. Prepare the journal entries necessary to record the sale, including updating the fair-value adjustment, recording any reclassification adjustment, and recording the sale.

Reference no: EM132680746

Questions Cloud

Prepare appropriate journal entries related to investment : Prepare all appropriate journal entries related to the investment during 2021, assuming Runyan accounts for this investment by the equity method
What is saxa co march revenue using a cash-basis accounting : What is Saxa Co.'s March revenue using a cash-basis accounting system? What is Saxa Co.'s March revenue using an accrual-basis accounting system?
What are the key roles of government in lr : What are the key roles of government in LR? What are the key roles of the Labour Relations Board? How independent of government do you think Labour Relations.
Retrieve and review the hoovers profile for the company : e-Commerce Risk Analysis - Retrieve and review the Hoovers profile for the company. These profiles are written by professional analysts; pay close attention
Prepare additional journal entry necessary for tanner-unf : Prepare any additional journal entry necessary for Tanner-UNF to report its investment in the December 31, 2021, balance sheet
Which competitive pay policy would you recommend to employer : Which competitive pay policy would you recommend to an employer? Why? Does it depend on circumstances faced by the employer? Which ones?
Make the journal entries at the inception of the lease : Make the journal entries at the inception of the lease and for the first year's payment. Funding is provided by GF transfers to a DSF.
What should the bakers do to motivate their employees : Using the 3-Step Problem-Solving Approach and the Organizing Framework, what should the Bakers do to motivate their employees and get support for the company's.
Find how should the preference shares be accounted : Find how should the preference shares be accounted for in accordance with AASB 132? (Hint:the relevant principlesto guide this decision are stated

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +91-977-207-8620

Phone: +91-977-207-8620

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd