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A bond sinking fund investment is started on January 5, 2010, by transferring $10,000 in cash to the fund. This $10,000 is invested and earns $1,100 during 2010. The entry to record the earnings made
on the sinking fund investment includes (Points : 5) a) a debit to Cash for $1,100 and a credit to Income from Sinking Fund Investment for $1,100. b) a debit to Cash for $1,100 and a credit to Bond Sinking Fund Investment for $1,100. c) a debit to Bond Sinking Fund Investment for $1,100 and a credit to Income from Sinking Fund Investment for $1,100. d) a debit to Cash for $1,100 and a credit to Interest Income for $1,100.
The entry to record the earnings made on the sinking fund investment includes a) a debit to Cash for $1,100 and a credit to Income from Sinking Fund Investment for $1,100.
Expert answered|OxTornado007|Points 5428|
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Asked 9/17/2012 12:47:53 PM
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Updated 9/17/2012 12:50:57 PM
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When bonds mature, a corporation will pay the bondholders the face amount of the bonds.
Added 9/17/2012 12:51:02 PM
This answer has been confirmed as correct, not copied, and helpful.
Confirmed by andrewpallarca [7/31/2014 12:33:05 PM]
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