Question: interest on bond investments on february 1 hansen company purchased...
Interest on Bond Investments
On February 1, Hansen Company purchased $114,000 of 9%, 10-year Knight Company bonds at their face amount plus one month’s accrued interest. The bonds pay interest on January 1 and July 1. On October 1, Hansen Company sold $40,800 of the Knight Company bonds acquired on February 1, plus three months’ accrued interest. On December 31, three months’ interest was accrued for the remaining bonds.
Determine the interest earned by Hansen Company on Knight
Company bonds for the year. Do not round interim calculations. If
required, round final answer to the nearest dollar.