Learning Objectives
By the end of this section, you will be able to:
- The students should be able to develop the accounting for long-term obligations and investments in stocks and bonds.

- Evaluate the alternatives for financing on a long-term basis.
- Describe the differences among various types of bonds.
- Record the entries associated with a bond issue sold at face value.
- Explain the valuation of investments and financial statement presentation.
- Record the entries for a bond issue sold at a discount and sold at a premium, using the straight-line amortization method.
- Determine the items that impact the selling price of a bond.
- Record the entries for the redemption of bonds.
- Determine the carrying value of a bond.
- Distinguish between a capital lease and an operating lease and record the entries associated with the capitalization of a lease.
- Explain why a corporation would invest in the bonds of other corporations.
- Account for investments in bonds:
- At acquisition
- While the corporation owns them
- At the time of sale