2. The bond with a face value of $5,000,000, is sold at 102. The entry to record the issuance is A) Dr. Cash 5,100,000 Cr. Bonds Payable 5 ,100,000 B) Dr. Cash 5 ,000,000 Dr. Premium on Bonds Payable 100,000 Cr. Bonds Payable 5 ,100,000 C) Dr. Cash 5 ,100,000 Cr. Premium on Bonds Payable 100,000 Cr. Bonds Payable 5,000,000 D) Dr. Cash 5,100,000 Cr. Discount on Bonds Payable 100,000 Cr. Bonds Payable 5,000,000 3. Terry Tractors, Inc. has outstanding a $100,000, 10-year bond issue which was sold on January 1, 2004, at a price of $110,000. The following liability, shown below, appeared on the balance sheet on December 31, 2008. Bonds payable ................. $100,000 +Unamortized Premium ..... 4,000 Carrying Value $104,000 The firm calls the bonds at 106 on January 1, 2009. Which of the following is correct regarding the redemption of the bond? A) The gain on redemption of the bond is $6,240. B) The repurchase price is $110,240. C) The gain on redemption of the bond is $2,000. fababonde 200 D) The loss on redemption of the bond is $2,000. 4. On May 1, ABC Co, borrowed $60,000 on a 6-month, 10% note. The accounting period ends at Dec. 31. Which of the following is not the effect of the payment at maturity? A) Liabilities are decreased by $60,000 B) Expenses are increased by $3,000 C) Total assets are decreased by $63,000 D) Liabilities are increased by $60,000 C Focus MacBook Air