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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?
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.
What else can I help you with?
Why should investors take an interest in international investment?
Because that is where the best investment might lay.
The Importance of Interest?
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.
How do interest rates affect investment?
When interest rates are high, investors will consider investing in short term investments, instead of long term investments. When interest rates are low, investors will consider investing in bonds because they are safer.
Nature of investment decisions?
Investment decisions are made by investors and stockholders about how and where money will be invested. Most of the time investments are made in the interest of companies and retirement plans.
Why should investors in the bond market be concerned about changes in interest rates and how do these changes impact their investment decisions?
Investors in the bond market should be concerned about changes in interest rates because they directly affect the value of their bond investments. When interest rates rise, bond prices typically fall, and vice versa. This means that investors may experience losses if they need to sell their bonds before maturity. Additionally, changes in interest rates can impact the overall return on investment for bondholders, as higher rates can lead to lower yields on existing bonds. Therefore, investors need to closely monitor interest rate movements and consider adjusting their investment strategies accordingly.
Relationship between required rate of return and coupon rate on the value of a bond?
required rate of return is the 'interest' that investors expect from an investment project. coupon rate is the interest that investors receive periodically as a reward from investing in a bond
Who is the internal user and who is the external user in accounting?
Internal users include various interest parties: Management Employees (including Trade Unions) External users include various interested parties: investors Government Customers Suppliers Lenders Competitors The Public Special Interest Groups (eg an Environmental group) External auditors check the veracity of the published accounts for the business
How does the description of accounting as the language of business relate to accounting as being useful for investors and creditors?
creitors are the persons who have extended credit to the company.they are also interested in the financial statements because they wiil help them in ascertaining whether the enterprise will be in a position to meet its commitment towards them both regarding payment of interest and principal... investors: a person who is contemplaing an investment in a business will like to know about its profitability and financial position.a study of the financial statements will help them in this respect
What are the different types of risk that investors should consider when making an investment?
Investors should consider various types of risks when making an investment, including market risk, liquidity risk, credit risk, inflation risk, and interest rate risk. These risks can affect the potential return on investment and should be carefully evaluated before making investment decisions.
What will an investor receives who waits until a debt instrument fully matures?
The investors who keep the investment until the debt instrument matures will receive the market rate of interest on their investment from the date of purchase.
How can investors receive compounding returns?
Investors can receive compounding returns by reinvesting their earnings, such as dividends or interest, back into their investment portfolio. This practice allows their initial investment to generate returns on both the original principal and the accumulated earnings over time. The power of compounding increases as the investment horizon lengthens, leading to exponential growth. To maximize compounding effects, investors should also consider maintaining a long-term investment strategy and minimizing withdrawals.
Who is the central interest of accounting?
the central interest of accounting
