A) $4,624,000 B) $4,704,000 C) $5,376,000 D) $5,296,000 on notes recevabis the primary effect of amortizing a discount A) It increases the 4) Which of the following i rate of return is brought up to the higher market rate B) It reduces the interest revenue so that the corporation's effective receivable until the carrying value is equal to the face value of the note. C Both A and B are the primary effects of amortizing a discount. discount and increases the carrying value of the n D) None of the above are accurate. of the following statements regarding available-for-sale debt value adjustments are treated as adjustments to net income. for-sale securities are valued on the balance sheet at 5) Which securities is true? B) Fair v alue adjustments are treated as adjustments to other comprehensive income C) Available- historical cost. D) Interest revenue and fair value adjustments are netted to determine the effect on net income. 6) On January 1, Year 1, Gibson Corporation purchased bonds issued by Williamson Company. These bonds were classified as held-to-maturity securities. The face value of these bonds is $200,000, pay 8% interest and were purchased to yield 6%. The bonds mature in 10 years and pay interest on an annual basis. If Gibson Corporation paid $229,440 for these bonds, how much interest revenue should it report on the bonds at December 31, Year 1? Assume that Gibson used the effective interest method. A) $22,944 B) $12,000 C) $16,000 D) $13,766 7) On September 30, 2016, Angel Outfitters invested in 10-year $200,000, 8% bonds of ABC Co. These bonds were dated January 1, 2016, and pay interest annually on December 31. Angel paid face value plus accrued interest for these bonds, and intends to hold these bonds until maturity. Which of the following is the correct journal