11. A corporation issues bonds that pay interest each May 1 and November 1. The corporation’s December 31 adjusting entry may include a

a. credit to Cash.

b. debit to Interest Payable.

c. debit to Cash.

d. credit to Discount on Bonds Payable.

e. credit to Interest Expense.

Use this information to answer questions 12–16.

McCabe Corporation issued $560,000 of 7% 10-year bonds. The bonds are dated and sold on January 1, 20X1. Interest payment dates are January 1 and July 1. The bonds are issued for $521,724 to yield the market interest rate of 8%. Use the effective-interest method for questions 12–16.