On December 31, Year 1, Airways Corp. issued $1 million in bonds at 5 percent annual interest,

Question:

On December 31, Year 1, Airways Corp. issued $1 million in bonds at 5 percent annual interest, due December 31, Year 6 at a discount of $100,000. Airways incurred bank fees of $100,000, legal fees of $50,000, and salaries of $25,000 for its employees in conjunction with issuing the bonds. What is the original carrying amount for these bonds?    

a. $725,000.     

b. $750,000.     

c. $850,000.     

d. $900,000.    

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

International Accounting

ISBN: 978-0078110955

3rd Edition

Authors: Timothy Doupnik, Hector Perera

Question Posted: