(a) A company purchased a $20,000, 9 percent (payable annually on each June 30), bond on 10/31 2002. Give the entry to record this transaction, assuming purchase at par plus any accrued interest. The bond is accounted for using the cost method.
(b) Give the adjusting entry (if any) that should be made on December 31, 2012, end of the accounting period.

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The Answer of (a) A company purchased a $20,000, 9 percent (payable annually on each June 30), bond on 10/31 2002. Give the entry to record this transaction, assuming purchase at par plus any accrued interest. The bond is accounted for using the cost method.
(b) Give the adjusting entry (if any) that should be made on December 31, 2012, end of the accounting period.

(A) a Company Purchased a $20,000, 9 Percent (Payable Annually