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On January 1, 2018, Warner Inc. purchased 3.5%, $50,000 face value Jackson Corp. bonds at face value. Interest is payable semi-annually on July 1 and January 1. The bonds are classified as held for trading investments. The bonds were sold on July 2, 2018 for $53,000.
-Warner's entry to record the purchase would include a debit to
A) Held for Trading Investments for $50,000.
B) Cash for $50,000.
C) Bonds Payable for $50,000.
D) Long-Term Investments for $50,000.

Question

Quizplus · Accepted Answer

The purchase of bonds classified as held for trading investments would be recorded with a debit to Held for Trading Investments for the face value of the bonds, which is $50,000.

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