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Accounting 26th Edition by Carl Warren ,Jim Reeve ,Jonathan Duchac
Edition 26ISBN: 978-1337498159Accounting 26th Edition by Carl Warren ,Jim Reeve ,Jonathan Duchac
Edition 26ISBN: 978-1337498159 Exercise 62
Interest on bond investments
On April 1, 2016, Rizzo Company purchased $80,000 of 4.5%, 20-year Energizer Company bonds at their face amount plus one month's accrued interest. The bonds pay interest on March 1 and September 1. On November 1, 2016, Rizzo Company sold $30,000 of the Energizer Company bonds acquired on April 1, plus two months' accrued interest. On December 31, 2016, four months' interest was accrued for the remaining bonds.
Determine the interest earned by Rizzo Company on Energizer Company bonds for 2016.
On April 1, 2016, Rizzo Company purchased $80,000 of 4.5%, 20-year Energizer Company bonds at their face amount plus one month's accrued interest. The bonds pay interest on March 1 and September 1. On November 1, 2016, Rizzo Company sold $30,000 of the Energizer Company bonds acquired on April 1, plus two months' accrued interest. On December 31, 2016, four months' interest was accrued for the remaining bonds.
Determine the interest earned by Rizzo Company on Energizer Company bonds for 2016.
Explanation
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Calculation of interest earned on bond i...
Accounting 26th Edition by Carl Warren ,Jim Reeve ,Jonathan Duchac
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