Landmark Buys $300,000 of Schroeter Company's 8%, 5-Year Bonds Payable

Multiple Choice

Landmark buys $300,000 of Schroeter Company's 8%, 5-year bonds payable at par value on September 1. Interest payments are made semiannually on March 1 and September 1. The journal entry Landmark should record to accrue interest earned at year-end December 31 is:

A) Debit Interest Receivable $12,000, credit Interest Revenue $12,000.
B) Debit Interest Receivable $8,000, credit Interest Revenue $8,000.
C) Debit Cash $8,000, credit Interest Revenue $8,000.
D) Debit Interest Revenue $8,000, credit Interest Receivable $8,000.
E) Debit Cash $12,000, credit Interest Revenue $12,000.