Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. 2) on july 1, 2019, cyclic inc. issued $1,000,000

2) On July 1, 2019, Cyclic Inc. issued $1,000,000 in principal of 6% bonds due...

80.2K

Verified Solution

Question

Accounting

image

2) On July 1, 2019, Cyclic Inc. issued $1,000,000 in principal of 6% bonds due in July 2024. The bond pays interest quarterly on January 2, April 1, July 1, and October 1. On July 1, 2020, immediately following an interest payment, Epimetheus Bank purchased $5000 in face value of these bonds for $4501. Epimetheus Bank intends to trade this bond as part of its business operations. When Epimetheus Bank purchased the bond, it calculated that the historic market rate was 9%. When Epimetheus Bank received the interest payment on October 1, 2020, what were the journal entries? Check all that apply. Dr. Cash -- $75 Cr. Interest revenue -- $101 Cr. Trading debt receivable -- $26 Cr. Interest revenue -- $75 Dr. Cash -- $101 Dr. Amortization of discount on trading debt -- $26

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students