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 adjusting entry to amortize the bond investment on December 31, 2012 would include a:

A) debit to Cash $200.
B) debit to Cash $1,200.
C) debit to Long-Term Investment in Bonds $1,200.
D) debit to Long-Term Investment in Bonds $ 200.