On January 1,Year 1 Alcorn Corporation purchased $95,000 of 9% bonds at face value.The bonds are classified as a held-to-maturity investment.The bonds pay interest semiannually on January 1 and July 1.On December 31,Year 1,the fair value of the bonds is $98,000
Required:
1.Prepare the journal entries to record the acquisition of the bonds and the first two interest payments.Include any year-end adjusting entries.
2.If the bonds were classified as an available for sale security,what additional adjusting entry would be made on December 31?

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The Answer of On January 1,Year 1 Alcorn Corporation purchased $95,000 of 9% bonds at face value.The bonds are classified as a held-to-maturity investment.The bonds pay interest semiannually on January 1 and July 1.On December 31,Year 1,the fair value of the bonds is $98,000
Required:
1.Prepare the journal entries to record the acquisition of the bonds and the first two interest payments.Include any year-end adjusting entries.
2.If the bonds were classified as an available for sale security,what additional adjusting entry would be made on December 31?

On January 1,Year 1 Alcorn Corporation Purchased $95,000 of 9