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Ruben Company purchased $100,000 of Evans Company bonds at 100 plus $1,500 in accrued interest. The bond interest rate is 8% and interest is paid semi-annually.
Required:
1. The journal entry to record the receipt of interest on the next interest payment date would be ___________.
a. Debit: Cash $4,000; Credit: Interest Receivable $1,500 and Interest Revenue $2,500
b. Debit: Cash $4,000; Credit: Interest Receivable $4,000
c. Debit: Cash $4,000; Credit: Interest Revenue $4,000
d. Debit: Cash $2,500; Credit: Interest Revenue $2,500

Respuesta :

Answer:

1. The journal entry to record the receipt of interest on the next interest payment date would be Debit: Cash $4,000; Credit: Interest Receivable $1,500 and Interest Revenue $2,500

Correct option is A

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