Barnes Company purchased $50,000 of 8% bonds at par. The bonds mature in six years and are classified as a held-to-maturity security. Which of the following is the correct journal entry to record the receipt of the usual semiannual interest payment?
A. debit Cash, $2,000; credit Interest Revenue, $2,000.
B. debit Unrealized Gain-Equity, $2,000; credit Cash, $2,000.
C. debit Cash, $4,000; credit Long-Term Investments-HTM, $4,000.
D. debt Cash, $2,000; credit Long-Term Investments-HTM, $2000.
E. debit Cash, $4,000; credit Unrealized Gain-Equity, $4,000.
Answer: A
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