Ban Co. purchased 50 5% Waylan Company bonds on January 1 2016 for $50500 cash. Interest is payable annually on January 1. The entry to record the January 1 2017 annual interest payment would include a

A) debit to Interest Revenue for $2500.
B) credit to Interest Receivable for $2500.
C) credit to Interest Revenue for $2525.
D) credit to Debt Investments for $2525.

Interest Receivable

A term in accounting referring to interest revenue that is accumulated but has not yet been paid in cash.

Interest Revenue

Income earned from lending funds or investing in interest-bearing assets.

Debt Investments

Financial assets purchased with the expectation that the investment will generate interest income from the debtor and be repaid at a future date.