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A government entity issues 5,000,000 of 4%. 20-year term bonds at a price of 5,300,000 interest is paid semiannually. The effective yield is 3.77%. How
A government entity issues 5,000,000 of 4%. 20-year term bonds at a price of 5,300,000 interest is paid semiannually. The effective yield is 3.77%.
How should the entity record the second semiannual interest payment?
A debit cash 200,000 credit bond interest expense 199806 credit bond premium 194
B debit cash 100,000 credit bond interest expense 99,903 credit bond premium 97
C debit bond interest expense 99,903 debit bond premium 97 credit cash 100,000
D debit bond interest expense 199,806 debit bond premium 194 credit cash 200,000
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