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Purchasing Debt Securities On January 1 Issuing Company issued $50000 in debt securities The stated interest rate on the debt securities is 8% with interest payable semiannually on June

Purchasing Debt Securities

On January 1, Issuing Company issued $50,000 in debt securities. The stated interest rate on the debt securities is 8%, with interest payable semiannually, on June 30 and December 31. On February 1, Purchasing Company purchased the bonds from the private investor who acquired them when they were originally issued. Purchasing Company paid the private investor an amount equal to the face value of the securities plus accrued interest. The securities were purchased as trading securities. Make the journal entries necessary on Purchasing Company’s books to record the security purchase and the receipt of interest on June 30 using (1) the asset approach and (2) the revenue approach.

Jul 09 2020 View more View Less

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