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On August 1, 2021, Crane Company acquired 1310, $1000, 9% bonds at 97 plus accrued interest. The bonds were dated May 1, 2018, and mature on April 30, 2027, with interest paid each October 31 and April 30. The bonds will be added to Crane’s available-for-sale portfolio. The preferred entry to record the purchase of the bonds on August 1, 2021 is a. Debt Investments 1310000   Interest Revenue 29475         Discount on Debt Investments 39300       Cash   1300175 b. Debt Investments 1300175

On August 1, 2021, Crane Company acquired 1310, $1000, 9% bonds at 97 plus accrued interest. The bonds were dated May 1, 2018, and mature on April 30, 2027, with interest paid each October 31 and April 30. The bonds will be added to Crane’s available-for-sale portfolio. The preferred entry to record the purchase of the bonds on August 1, 2021 is a. Debt Investments 1310000   Interest Revenue 29475         Discount on Debt Investments 39300       Cash   1300175 b. Debt Investments 1300175

FINANCIAL ACCOUNTING
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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On August 1, 2021, Crane Company acquired 1310, $1000, 9% bonds at 97 plus accrued interest. The bonds were dated May 1, 2018, and mature on April 30, 2027, with interest paid each October 31 and April 30. The bonds will be added to Crane’s available-for-sale portfolio. The preferred entry to record the purchase of the bonds on August 1, 2021 is
a.

Debt Investments 1310000  
Interest Revenue 29475  
      Discount on Debt Investments 39300
      Cash   1300175

b.

Debt Investments 1300175  
      Cash   1300175

c.

Debt Investments 1270700  
Interest Receivable 29475  
      Cash   1300175

d.

Debt Investments 1270700  
Interest Revenue 29475  
      Cash   1300175
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