Business, 20.12.2019 03:31 mostman077

Tanner-unf corporation acquired as a long-term investment $240 million of 6% bonds, dated july 1, on july 1, 2018. the market interest rate (yield) was 8% for bonds of similar risk and maturity. tanner-unf paid $200 million for the bonds. the company will receive interest semi-annually on june 30 and december 31. company management is holding the bonds in its trading portfolio. as a result of changing market conditions, the fair value of the bonds at december 31, 2018, was $210 million.
1. & 2. prepare the journal entry to record tanner-unf’s investment in the bonds on july 1, 2018 and interest on december 31, 2018, at the effective (market) rate.
3. prepare any additional journal entry necessary for tanner-unf to report its investment in the december 31, 2018, 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, 2019, for $190 million. prepare the journal entries to record the sale.

Answers: 3

Show answers

Another question on Business

Business, 22.06.2019 03:50

John is a 45-year-old manager who enjoys playing basketball in his spare time with his teenage sons and their friends. at work he finds that he is better able to solve problems that come up because of his many years of experience, but while on the court, he finds he is not as good keeping track of the ball while worrying about the other players. john's experience is:

Answers: 1

Answer

Business, 22.06.2019 04:10

You are head of the schwartz family endowment for the arts. you have decided to fund an arts school in the san francisco bay area in perpetuity. every 5 years, you will give the school $ 1 comma 000 comma 000. the first payment will occur 5 years from today. if the interest rate is 5.9 % per year, what is the present value of your gift?

Answers: 1

Answer

Business, 22.06.2019 12:50

Afirm’s production function is represented by q(m,r) = 4m 3/4r1/3, where q denotes output, m raw materials, and r robots. the firm is currently using 6 units of raw materials and 12 robots. according to the mrts, in order to maintain its output level the firm would need to give up 2 robots if it adds 9 units of raw materials. (a) true (b) false

Answers: 3

Answer

Business, 22.06.2019 17:00

Cadbury has a chocolate factory in dunedin, new zealand. for easter, it makes two kinds of “easter eggs”: milk chocolate and dark chocolate. it cycles between producing milk and dark chocolate eggs. the table below provides data on these two products. demand (lbs per hour) milk: 500 dark: 200 switchover time (minutes) milk: 60 dark: 30 production rate per hour milk: 800 dark: 800 for example, it takes 30 minutes to switch production from milk to dark chocolate. demand for milk chocolate is higher (500lbs per hour versus 200 lbs per hour), but the line produces them at the same rate (when operating): 800 lbs per hour. a : suppose cadbury produces 2,334lbs milk chocolate and 1,652 lbs of dark chocolate in each cycle. what would be the maximum inventory (lbs) of milk chocolate? b : how many lbs of milk and dark chocolate should be produced with each cycle so as to satisfy demand while minimizing inventory?

Answers: 2

Answer

You know the right answer?

Tanner-unf corporation acquired as a long-term investment $240 million of 6% bonds, dated july 1, on...

Questions