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Ivanhoe Company purchased $1000000 of 9% bonds of Scott Company on January 1, 2018, paying $930375. The bonds mature January 1, 2028; interest is payable
Ivanhoe Company purchased $1000000 of 9% bonds of Scott Company on January 1, 2018, paying $930375. The bonds mature January 1, 2028; interest is payable each July 1 and January 1. The discount of $69625 provides an effective yield of 10%. Ivanhoe Company uses the effective-interest method and plans to hold these bonds to maturity. On July 1, 2018, Ivanhoe Company should increase its Debt Investments account for the Scott Company bonds by:
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