Response to the following problem:
On June 30, 20X3, Greenbrier Corporation paid 92 for 6% bonds of Dean Witter Financial Services as a long-term held-to-maturity investment.
The maturity value of the bonds will be $30,000 on June 30, 20X8. The bonds pay interest on June 30 and December 31. March 31, 20X8.
Required:
1. What method should Greenbrier Corporation use to account for its investment in the Dean Witter bonds?
2. Using the straight-line method of amortizing the discount, journalize all of Greenbrier's transactions on the bonds for 20X3.
3. Show how Greenbrier would report the bond investment on its balance sheet at December 31, 20X3.