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Question
Jacks Corporation purchases $200,000 bonds plus accrued interest for 2 months of $2,000 from Kennedy Company on March 1. The bonds have an annual interest rate of 6% payable on June 30 and December 31. The entry for the purchase of the bonds would include a
a. debit to Interest Receivable for $2,000
b. debit to Investments—Kennedy Company Bonds for $202,000
c. debit to Cash for $200,000
d. credit to Interest Revenue for $2,000
Answer
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