On May 1, 2014, Stanton Company Purchased $60,000 of Harris

question 56

Multiple Choice

On May 1, 2014, Stanton Company purchased $60,000 of Harris Company's 12% bonds at 100 plus accrued interest of $2,400. On June 30, 2014, Stanton received its first semiannual interest. On February 1, 2015, Stanton sold $50,000 of the bonds at 103 plus accrued interest. The journal entry Stanton will record on February 1, 2015, will include:

• A) a credit to Interest Revenue for $1,500.
• B) a credit to Gain on Sale of Investments for $1,500.
• C) a credit to Cash for $52,500.
• D) a credit to Interest Receivable for $600.

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Definitions:

Budget

An internal financial plan that forecasts expenses and income over a set period of time.