Multiple Choice
On January 1, 2017, Pale Company purchased as an investment a $900, 8% bond for $680. Pale plans to hold the bond until the maturity date on January 1, 2027. The bond pays interest on January 1 and July 1. The company's fiscal year ends on December 31 and it uses the straight-line amortization method for discounts and premiums. The entries on December 31, 2017 would include a:
A) debit Interest Receivable for $36.
B) debit Held-to-Maturity Investment in Bonds for $36.
C) debit Interest Receivable for $11.
D) credit Held-to-Maturity Investment in Bonds for $11.
Correct Answer:
Verified
Correct Answer:
Verified
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