Bay Company acquires 60 8% 5 year $1000 Community bonds on January 1 2017 for $60000. The journal entry to record this investment includes a debit to

Question

Quizplus · Accepted Answer

The journal entry to record the purchase of the bonds would include a debit to Debt Investments for the cost of the investment, which in this case is $60000. The fact that the bonds have an 8% coupon rate and a 5-year maturity is not relevant to the journal entry at the time of purchase.

Bay Company Acquires 60 8% 5 Year $1000 Community Bonds