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Barnes Company Holds $50,000 of 8% Bonds That Mature in Six

Question 67

Multiple Choice

Barnes Company holds $50,000 of 8% bonds that mature in six years as a held-to-maturity security.Which of the following is the correct journal entry to record the receipt of the semiannual interest payment?


A) debit Cash,$4,000;credit Long-Term Investments-HTM,$4,000.
B) debt Cash,$2,000;credit Long-Term Investments-HTM,$2000.
C) debit Cash,$2,000;credit Interest Revenue,$2,000.
D) debit Unrealized Gain-Equity,$2,000;credit Cash,$2,000.
E) debit Cash,$4,000;credit Unrealized Gain-Equity,$4,000.

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