On January 2, 20X1, West Company issued 9%, 10-year bonds in the amount of $500,000 that mature on December 31, 20X9. The bonds were issued for $469,500 to yield 10%. Interest is payable annually on December 31. West uses the effective interest method of amortizing bond discounts. What net amount should West report as bonds payable in its balance sheet by end of June 30, 20X1? Book reference (LO 12-2)

DR Interest expense?

CR Interest Payable?

CR Bond discount?

A. Interest expense= value($) of bonds issued at 10% X % yield X # of months

B. Interest payable: 10-year bonds amount X issued % X # of months. Bond discount = A-B?