Jr's is using the revenue approach to record the accrued interest.
JR's classifies these bonds as available for sale security
1. purchased $100,000 of U.S treasury 7% bonds, paying 102.5 plus
accrued interest of $1,750. The company also paid $500 for brokerage
fees
2 purchased 1,000 shares of xyz company stock at $125 per share plus
brokerage fees of 950. JR's classifies this stock as available for
sale security
3. received semiannual interest on the U.S treasury bonds
4. sold 150 share of xyz company at 132 per share
5. sold $16,000 of U.S treasury 7% bonds at 102 plus accured interest of $93
6. Purchased a $12,000, 6 month certificate of deposit. The
certificate is classifed as a trading security |
