Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Question 15 Not yet answered Marked out of 1:00 Flag question THIS MULTIPLE CHOICE QUESTION (MCO) IS BASED ON THE STRAWBERRY COMPANY SCENARIO BELOW: STRAWBERRY
Question 15 Not yet answered Marked out of 1:00 Flag question THIS MULTIPLE CHOICE QUESTION (MCO) IS BASED ON THE STRAWBERRY COMPANY SCENARIO BELOW: STRAWBERRY Company purchased the bonds of another company on 1 January 2019. The following information about the Debt investment (i.e, the purchased bonds) is available: Face Value (1.e. Nominal value) $2,000,000; Stated rate (ie, Coupon or Nominal rate): 8% per year (i.e. per anrum) Effective rate (.e., Yield): 6% per year i.e., per annum) life: 2 years .n.erest: Semi-Annual on 30 June and 31 December The Present Value (PV) Foctor end Annuity Factor for a range of interest rates for N=4 are as follows: Rate PV Factor Annuity Factor (Table 6-2) (Table 6-4) 3% 0.889 3.72 4% 0.855 3.63 5% 0.823 3.55 6% 0.747 3.47 (note: the relevant exact values from the above table must be utilized in your ca culation MCQ What entry should STRAWBERRY Company record in the Debt Investment Account on 30 June 2019? (round to two decimal places in all calculations) Select one: A. DEBIT $14,950.00 D CREDIT S16,710 70 c. None of these answers d. CREDIT $13,680.00 e. CREDIT $17,732.00
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started