Asked by Diana Eynullaeva on May 21, 2024
Verified
On January 1 2017 Brenner Company purchased at face value a $1000 10% bond that pays interest on January 1. Brenner Company has a calendar year end. The entry for the receipt of interest on January 1 2018 is a.
Cash 110 Interest Revenue 110\begin{array}{llr} \text { Cash } &110\\ \text { Interest Revenue } &&110\\\end{array} Cash Interest Revenue 110110
b.
Cash 100 Interest Revenue 100\begin{array}{llr} \text { Cash } &100\\ \text { Interest Revenue } &&100\\\end{array} Cash Interest Revenue 100100
c.
Cash 40 Interest Revenue 40\begin{array}{llr} \text { Cash } &40\\ \text { Interest Revenue } &&40\\\end{array} Cash Interest Revenue 4040
d.
Cash 100 Interest Receivable100\begin{array}{llr} \text { Cash } &100\\ \text { Interest Receivable} &&100\\\end{array} Cash Interest Receivable100100
Face Value
The nominal or dollar value printed on a financial instrument, such as a bond or stock certificate, representing its legal worth.
Interest Receivable
An asset account that represents the amount of interest income that has been earned but not yet received in cash.
- Attain insight into the accounting protocols and entries for the acquisition, accumulation of interest, and liquidation of debt investments.
Verified Answer
GS
Learning Objectives
- Attain insight into the accounting protocols and entries for the acquisition, accumulation of interest, and liquidation of debt investments.
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