On July 1, Year 1, Fairfield Company purchased $2 million of Hampton Corporation’s 6% bonds…

On July 1, Year 1, Fairfield Company purchased $2 million of Hampton Corporation’s 6% bonds…

On July 1, Year 1, Fairfield Company purchased $2 million of Hampton Corporation’s 6% bonds for $1,731,590. The bonds were purchased to yield 8% interest and were classified as held-to-maturity securities. The bonds mature in 10 years and pay interest annually on July 1. Assuming that Fairfield uses the effective interest method of amortization, what amount should it report for its investment in bonds on December 31, Year 1?

On July 1, Year 1, Fairfield Company purchased $2 million of Hampton Corporation’s 6% bonds…

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