Week 3 Individual - (1) On January 1, 2006, Jamona Corp....

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Unformatted text preview: (1) On January 1, 2006, Jamona Corp. Purchased 12% bonds, having a maturity value of $300,000, for $322,744.44. The bonds provide the bondholders with a 10% yield. They are dated January 1, 2006, and mature January 1, 2011, with interest receivable December 31 of each year. The company uses the effective- interest method to allocate unamortized discount or premium. The bonds are classified as available-for-sale. The fair value of the bonds at December 31 of each year is as follows: Year Amount 2006 $320,500.00 2007 $309,000.00 2008 $308,000.00 2009 $310,000.00 2010 $300,000.00 Bond Amortization Table Date Interest Payment Effective Interest 31-Dec-06 $36,000.00 $32,274.44 31-Dec-07 $36,000.00 $31,901.89 31-Dec-08 $36,000.00 $31,492.08 31-Dec-09 $36,000.00 $31,041.28 31-Dec-10 $36,000.00 $30,545.41 1-Jan-06 Investment in Bonds - Available for Sale Cash Purchased Bonds for Cash - Available for Sale 31-Dec-07 Cash Interest Revenue Received Interest on Investment in Bonds 31-Dec-07 Interest Revenue Investment in Bonds - Available for Sale Amortization of Bond Premium 31-Dec-07 Unrealized Holding Gain or Loss - Equity Securites Fair Value Adjustment Adjust Invest in Bonds to Fair Market Value (2) The following information is available from Jamon's inventory records: January 1 2007 (beginning inventory) Purchases: 5-Jan-07 25-Jan-07 16-Feb-07 26-Mar-07 A physical inventory on March 31, 2007, shows 1,600 units on hand. Select any one of A physical inventory on March 31, 2007, shows 1,600 units on hand....
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Week 3 Individual - (1) On January 1, 2006, Jamona Corp....

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