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On November 1, 2018, Carla Vista Company purchased Lopez, Inc., 10-year, 8%, bonds with a face value of $750000, for $670000. An additional $20000 was
On November 1, 2018, Carla Vista Company purchased Lopez, Inc., 10-year, 8%, bonds with a face value of $750000, for $670000. An additional $20000 was paid for the accrued interest. Interest is payable semiannually on January 1 and July 1. The bonds mature on July 1, 2025. Carla Vista uses the straight-line method of amortization. Ignoring income taxes, the amount reported in Carla Vista's 2018 income statement as a result of Carla Vista's available-for-sale investment in Lopez was
$11500.
$8500.
$12000.
$10000.
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