On January 1, 2012, Plymouth Company Purchases $100,000, 6% Bonds

Multiple Choice

On January 1, 2012, Plymouth Company purchases $100,000, 6% bonds at a price of 90.4 and a maturity date of January 1, 2016. Interest is paid semiannually, on January 1 and July 1. Plymouth Company has a calendar year end. The entry to record the purchase of the bond investment on January 1, 2012, would include a:

A) debit to Short-Term Investment in Bonds for $100,000.
B) debit to Short-Term Investment in Bonds for$ 90,400.
C) debit to Long-Term Investment in Bonds for $100,000.
D) debit to Long-Term Investment in Bonds for$ 90,400.