Question
On January 1, 2020, Sweetwood Corporation issues $5 million, 10-year, 9% bonds at 96, with interest payable annually on January 1. Which journal entry below
On January 1, 2020, Sweetwood Corporation issues $5 million, 10-year, 9% bonds at 96, with interest payable annually on January 1. Which journal entry below should be used to record this transaction on January 1, 2020? (Pick the corresponding letter (a), (b), (c), or (d) for your answer.)
(a) Cash........................................... 5,000,000
Bonds Payable........................................... 5,000,000
(b) Cash........................................... 4,800,000
Bonds Payable........................................... 4,800,000
(c) Discount on Bonds Payable..... 200,000
Cash............................................. 4,800,000
Bonds Payable......................................... 5,000,000
(d) Cash......................................... 5,000,000
Bonds Payable.......................................... 4,800,000
Premium on Bonds Payable................ 200,000
Group of answer choices
a. (b)
b. (d)
c. (c)
d. (a)
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