Berryhill Company purchased $100,000 bonds at 104. Accrued interest for three months was $1,000; brokerage fees...

Berryhill Company purchased $100,000 bonds at 104. Accrued interest for three months was $1,000; brokerage fees were $500. The cost of this long-term investments in bonds is:

Select one:

a. $106,000

b. $104,500

c. $105,000

d. $104,000

e. $106,500

Solutions

Expert Solution

Cost of the long term investment = Cost + Brokerage fees

= ($100,000 * $104 / $100) + $500

= $104,500

The answer is Option b.

ekkarill92 answered 2 years ago

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