For Each of the Following Transactions Related to Held-To-Maturity Debt

question 92

Essay

For each of the following transactions related to Held-to-Maturity Debt securities,state the following:
(1)Which account(s)is (are)increased?
(2)Which account(s)is (are)decreased?
(3)What is the net effect on total assets and total equity? This net effect can be increase,decrease,or no net effect.
Transaction:
a.The investment was purchased at $50,000 (face value)plus brokerage fees of $2,000.
b.Semiannual interest of $1,500 was received.
c.The investment was disposed of at maturity.Cash in the amount of $50,000 was received.
$$\begin{array} { | l | l | l | l | } \hline \text { Transaction } & \begin{array} { c } \text { Account(s) } \\\text { Increased }\end{array} & \begin{array} { c } \text { Account(s) } \\\text { Decreased }\end{array} & \begin{array} { c } \text { Total Assets and } \\\text { Total Equity: } \\\text { Increase, Decrease, } \\\text { or No Net Effect }\end{array} \\\hline \mathbf { a } & & & \\\hline \mathbf { b } & & & \\\hline \mathbf { c } & & & \\\hline\end{array}$$

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Definitions:

Operant Conditioning

A method of learning that occurs through rewards and punishments for behavior, coined by B.F. Skinner.

Modeling

is the process of learning behavior by observing and imitating others, especially those considered as role models.

Operant Conditioning

An educational method where a specific behavior's intensity is altered through rewards or penalties.

Operant

A behavioral concept referring to an action or behavior that is modifiable by its consequences in a learning environment.