Certificate of depositon may 31 2014 elmer corp purchased a, Ask an Expert

Accounting

Certificate of Deposit

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 com- pany's fiscal year.

c. The redemption of the CD. Assume 360 days in a year.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91625021

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