Land ark Corp. bu s 380,000 of Schroeter Company\'s 6% record the proceeds will
ID: 2559077 • Letter: L
Question
Land ark Corp. bu s 380,000 of Schroeter Company's 6% record the proceeds will be: ve year bonds p y le par volue on September Interest pm ents are made se annualy and ark pl ns to h the bonds or the ve year e when he bo s mature, the Jou n entry to O Debit Long Term Investments HTM $380000; credit Cash $380000 O Debit Cash $380,000, credit Interest Revenue $380.000. O Debit Cash $380,000, credit Long-Term Investments-HTM $380,000. O Debit Cash $380,000, credit Interest Receivable $380,000. O Debit Cash $380.000. credit Bonds Payable $380000Explanation / Answer
Solution:
Landmark Corp buys 6% five year bond at par value $380,000.
When bond matures Landmark Corp receive cash $380,000 (par value of bond) and close the investment account.
Journal entry to record the proceeds will be:
Debit Cash $380,000 and Credit Long Term Investment – HTM $380,000
Hence the correct option is Debit Cash $380,000 and Credit Long Term Investment – HTM $380,000
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