Prepare Krum Co.'s journal entries to record the following transactions involving its short-term investments in available-for-sale debt securities, all of which occurred during the current year.

a.On August 1, paid $78,000 cash to purchase Houtte's 9%, six-month debt securities ($78,000 principal), dated August 1.

b.On October 30, received a check from Houtte for 90 days' interest on the debt securities in transactiona.

1- On August 1, paid $78,000 cash to purchase Houtte's 9% six-month debt securities ($78,000 principal), dated August 1.

Transaction General Journal Debit Credit

a.

2- On October 30, received a check from Houtte for 90 days' interest on the debt securities in part a.

Transaction General Journal Debit Credit

b.