On May 31, 2014, Elmer Corp. purchased a 120-day, 9% certificate of deposit for $50,000. The CD
Question:
On May 31, 2014, Elmer Corp. purchased a 120-day, 9% certificate of deposit for $50,000. The CD was redeemed on September 28, 2014. Prepare the journal entries on Elmer’s books to account for:
a. The purchase of the CD.
b. The accrual of interest adjustment for interest earned through June 30, the end of the company’s fiscal year.
c. The redemption of the CD. Assume 360 days in a year.
Step by Step Answer:
a b c Journal 2014 Entry May 31 ShortTerm Investmen...View the full answer
Financial Accounting The Impact on Decision Makers
ISBN: 978-1285182964
9th edition
Authors: Gary A. Porter, Curtis L. Norton
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A journal entry is an act of keeping or making records of any transactions either economic or non-economic. Transactions are listed in an accounting journal that shows a company\'s debit and credit balances. The journal entry can consist of several recordings, each of which is either a debit or a credit
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