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Question(s) / Instruction(s):

Lance Co. purchased $36,000 of 6%, 10-year Bergen County bonds on January 12, 2010, directly from the county at par value. The bonds pay semiannual interest on May 1 and November 1. On December 1, 2010, Lance Co. sold $14,000 of the Bergen County bonds at 102 plus $70 accrued interest, less a $300 brokerage commission.

For a compound transaction, if an amount box does not require an entry, leave it blank.

Required:

A.            Provide the journal entry for the purchase of the bonds on January 12, 2010, plus 72 days of accrued interest.

B1.          Provide the journal entry for semiannual interest on May 1.

B2.          Provide the journal entry for semiannual interest on November 1.

C.            Provide the journal entry for sale of the bonds on December 1.

D.            Provide the journal entry for adjusting entry for accrued interest of $220 on December 31.

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