q4

7. Questions 7-10: On Jan 1, 2018, XYZ Company purchase 10% bonds, having a maturity value of $510,000, for $570,000. The bonds provide the bondholders with a 8% yield. They are dated Jan 1, 2018, and mature Jan 1, 2023 with interest receivable December 31 of each year. XYZ's business model is to hold these bonds to collect contractual cash flow. XYZ records at the date of the bond purchase as: cum (3 Points) O a. Cash $510,000 O Dr. Debt Investment $510,000 O Cr. Debt Investments ...... $570,000 Dr. Debt Investments ....y $570,000 8. Regarding to question No:7. XYZ records the interest received for 2018 (3 Points) 8 as: Cr. Interest Revenue.......... $45,600 Dr. Interest Revenue......... $45,600 Cr. Interest Receivable....... $57,000 Dr. Interest Revenue............ $40,800