At acquisition,debt securities are:
A)Recorded at their cost,plus total interest that will be received over the life of the security.
B)Recorded at the amount of interest that will be received over the life of the security.
C)Recorded at cost.
D)Not recorded,because no interest is due yet.
E)Recorded at cost plus the amount of dividend income to be received.

Question

Quizplus · Accepted Answer

Debt securities are recorded at cost at the time of acquisition. This cost includes any premiums or discounts paid at acquisition but not any interest that will be received over the life of the security as this is recognized as interest income over the life of the security.

At Acquisition,debt Securities Are