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When an investor's accounting period ends on a date that does not coincide with an interest receipt date for bonds held as an investment the investor must?
Wiki User
∙ 14y ago
When an investor's accounting period ends on a date that does not coincide with an interest receipt date for bonds held as an investment, the investor must
a. make an adjusting entry to debit Interest Receivable and to credit Interest Revenue for the amount of interest accrued since the last interest receipt date.
b. notify the issuer and request that a special payment be made for the appropriate portion of the interest period.
c. make an adjusting entry to debit Interest Receivable and to credit Interest Revenue for the total amount of interest to be received at the next interest receipt date.
d. do nothing special and ignore the fact that the accounting period does not coincide with the bond's interest period.
Wiki User
∙ 14y ago
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Because that is where the best investment might lay.
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Interest is the basis by which all investments should be measured, and calculating interest used to be a chore, even for the most seasoned of investors. Many chose to just leave it to their investment advisors. However, with the tools that the Internet provides to the common investor for free, people would be remiss not to calculate the interest on a particular investment as a common vetting procedure. Many financial sites provide free tools by which an investor can calculate the interest on an investment, both accounting and economic, based on current market conditions. Investors should be worried more about economic profit.
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