On January 1, 2019, Weaver Company purchased as held-to-maturity debt securities $500,000 face value of Park Corporations

Question:

On January 1, 2019, Weaver Company purchased as held-to-maturity debt securities $500,000 face value of Park Corporation’s 8% bonds for $456,200. The bonds were purchased to yield 10% interest and pay interest annually. The bonds mature on January 1, 2024. Weaver uses the effective interest method of amortization. What amount should Weaver report on its December 31, 2019, balance sheet as an investment in held-to-maturity debt securities?
a. $450,580
b. $456,200
c. $461,820
d. $466,200

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial... Face Value
Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the...

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