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Question 69

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Use the following information for questions.
Carsen Company purchased $200,000 of 10% bonds of Garrison Co.on January 1, 2012, paying $211,950.The bonds mature January 1, 2022; interest is payable each July 1 and January 1.The discount of $11,950 provides an effective yield of 9%.Carsen's objective is to hold the bonds to collect the contractual cash flows.Carsen Company uses the effective interest method.
-On July 1, 2012, Carsen Company should decrease its Held-for-collection Debt Investments account for the Garrison Co.bonds by:


A) $462.
B) $808.
C) $924.
D) $1,598.

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