Question

A bond sinking fund investment is started on January 5, 2010, by transferring $10,000 in cash to the fund. This $10,000 is invested and earns $1,100 during 2010. The entry to record the earnings made on the sinking fund investment includes a debit to _____and a credit to __________.
A. Cash for $1,100; Income from Sinking Fund Investment for $1,100

B. Cash for $1,100; Bond Sinking Fund Investment for $1,100

C. Bond Sinking Fund Investment for $1,100; Income from Sinking Fund Investment for $1,100

D. Cash for $1,100; Interest Income for $1,100

Answer 1

I know its not A

Answer 2

@amistre64 @dumbcow

Answer 3

is this for accounting...these options seem vague to me and i dont know the rules for sinking fund investment

Answer 4

yeah its accounting, im also confused on what the whole questions trynaa ask

Answer 5

cash increased by 1100

fund decreased by 1100

but with accounting you have to get terminology right....id say A,B or D

Answer 6

well its not A so B or D

Answer 7

why not A?

Answer 8

this is a problem I got wrong cause I picked A lol

Answer 9

Im leaning on B

Answer 10

oh haha...sure lets roll the dice again and go with B

i dont think there are any accounting people on here...im not really helping

Answer 11

I know its hard to find help any where, but you've somewhat helped me..thank you!