On 1/1/14, ABC Corporation purchased, as a held-to-maturity investment, $200,000 of the 8%, 5-year bonds of Intuit Corporation for $177,824,
which provides an 11% return. Prepare ABC's 12/31/14 journal entry to reflect the receipt of annual interest and discount amortization.
Assume the bond investment pays interest annually on 12/31 each year and that effective interest amortization is used.
Note: Notice that a discount account is not used for this investment. Therefore, for purposes of this adjusting entry, amortize the discount directly to the
investment account. Please tell me if I have the following adjusting entries correct: Debit Cash 16,000 Debit LT (Debit) Investments (HTM) 3,561 Credit Interest Revenue 19,561