Question
On January 1, a company issues bonds dated January 1 with a par value of $470,000. The bonds mature in 5 years. The contract rate
On January 1, a company issues bonds dated January 1 with a par value of $470,000. The bonds mature in 5 years. The contract rate is 11%, and interest is paid semiannually on June 30 and December 31. The market rate is 12% and the bonds are sold for $452,707. The journal entry to record the first Interest payment using straight-line amortization is D Multiple Choice KILL Debit Interest Expense $25.850,00; credit Cash $25,850.00 Debit Interest Expense $27.579.30, credit Discount on Bonds Payable $1,729.30; credit Cash $25.850.00 Debit Interest Expense $2412070: debit Discount on Bonds Payable $1729.30; credit Cash $25,850.00 Debit Interest Payable $25,850.00; creds Cash $25,850.00 717 2 Av Ma All D So Th Ra Sum mende % Debit Interest Expense $27579 30 credit Premium on Bonds Payable $1729.30: credit Cash $25.850.00 4:24
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