Accrued interest and Dividends

Gary R

I purchased US Treasury bonds with accrued interest. Now, Quicken downloaded the transaction as follows:

Cost of bond———-$100,000—-Cost Basis

Accrued interest $2500——-Misc expense

Total payment—$102,500

I think the cost basis of the Treasury should be $102,500

When the accrued interest is paid, it's just going to be downloaded as interest

Thoughts???????????????

NotACPA

Did you buy your Treasury bond on the market? Because that $2500 look to me that it was the interest due to the Seller of the bond, for the period that the seller held the bond.

When you get the next interest payment, you'll get the ENTIRE amount for the period … even the amount during the time that the seller owned the bond.

SO, that $2500 would actually be a Receivable, not an Expense, and the basis of your bond is $100,000.

BUT, it's odd that it's selling exactly at par, so are the numbers you cited actual, or made-up examples? And, how much will the next interest payment be?