Your answer is partially correct. Try again. Brook Company

| June 10, 2016

Question
Your answer is partially correct. Try again.
Brook Company purchased 90 Meissner Company 14%, 10-year, $1,800 bonds on January 1, 2014, for $165,100. Brook Company also had to pay $400 of broker’s fees. The bonds pay interest semiannually on July 1 and January 1. On January 1, 2015, after receipt of interest, Brook Company sold 70 of the bonds for $126,200.

Prepare the journal entries to record the transactions described above. (Round answers to 0 decimal places, e.g. 15,250. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date Account Titles and Explanation Debit Credit
Jan. 1, 2014
Debt Investments

db. 165,500

Cash

cr. 165,500

July 1, 2014
Cash

Interest Revenue

Dec. 31, 2014
Interest Receivable

Interest Revenue

Jan. 1, 2015
Cash

Interest Receivable

(To record receipt of interest)
Jan. 1, 2015
Cash

db.
126,200

Loss on Sale of Debt Investments

Investments

(To record sale of bonds)

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