Assume that on January 1, First Union Co. purchases for cash a $400,000 of Medford City 5% bond at 100 plus accrued interest of $4,500 as an investment on January 1. What accounts would be debited for the $10,000 to record the receipt of the first semiannual interest on July 1? DATE DESCRIPTION PREF DEBIT CREDIT July 1 (?) $10,000 (?) 4,500 (?) 5,500 Investment in Medford City Bonds Interest receivable Cash Interest revenue

Assume that on January 1, First Union Co. purchases for cash a $400,000 of Medford City 5% bond at 100 plus accrued interest of $4,500 as an investment on January 1. What accounts would be debited for the $10,000 to record the receipt of the first semiannual interest on July 1? DATE DESCRIPTION PREF DEBIT CREDIT July 1 (?) $10,000 (?) 4,500 (?) 5,500 Investment in Medford City Bonds Interest receivable Cash Interest revenue

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Subject : Accounting
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