Question
12.On October 1, 2020 Dona Corporation issued 5%, 10-year bonds with a face value of 1,000,000 at 108 (a 4% yield). Interest is paid on
12.On October 1, 2020 Dona Corporation issued 5%, 10-year bonds with a face value of 1,000,000 at 108 (a 4% yield). Interest is paid on October 1 and April 1, with any premiums or discounts amortized on an effective-interest basis. The entry to record the issuance of the bonds would be
debit of 1,025,000 to cash and credit of 1,000,000 to Bonds Payable; credit of 25,000 to Interest Payable.
debit of 80,000 to cash and credit of 80,000 to Bonds Payable
debit of 1,080,000 to cash; credit of 1,080,000 to Bonds Payable.
debit of 1,000,000 to cash and credit of 1,080,000 to Bonds Payable
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