Question
1. A corporation issues $500,000 of 20-year, 7% bonds dated January 1 at 95. The journal entry to record the issuance will include Group of
1.
A corporation issues $500,000 of 20-year, 7% bonds dated January 1 at 95. The journal entry to record the issuance will include
Group of answer choices
a credit to Bonds Payable for $500,000.
a credit to Premiums on Bonds Payable for $25,000.
a debit to Interest Expense for $25,000.
a credit to Discount on Bonds Payable for $25,000.
a debit to Cash for $500,000.
2.
If the market interest rate for a bond is higher than the stated interest rate, the bond will sell at
Group of answer choices
the conversion rate
a premium.
the termination rate
a discount.
par.
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