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On January 1, 2020, Berger Inc. and Wimmer Inc. both acquire 85 Peak Inc. 7%, 10-year, $1,000 bonds. As part of the purchase, Berger
On January 1, 2020, Berger Inc. and Wimmer Inc. both acquire 85 Peak Inc. 7%, 10-year, $1,000 bonds. As part of the purchase, Berger pays its broker a $4,750 service fee, while Wimmer pays its broker a 5% commission. In this scenario, both firms should credit Debt Investments for the same amount. Berger should debit Debt Investments for $500 more than Wimmer. Berger should credit Debt Investments for $500 more than Wimmer. O both firms should debit Debt Investments for the same amount.
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