Question
On March 1, 20X4, Grand Junction Railroad issued $50,000 of 8%, 10-year bonds dated March 1 for $43,769. Interest is payable on March 1 and
On March 1, 20X4, Grand Junction Railroad issued $50,000 of 8%, 10-year bonds dated March 1 for $43,769. Interest is payable on March 1 and September 1. If Grand Junction uses the straight-line method of amortization, how would these bonds appear on the September 1, 20X4, balance sheet? (Round all calculations to the nearest dollar.)
a. Long-term liabilities:
Bonds payable $50,000
Less: Discount on bonds payable 6,231 $43,769
b. Long-term liabilities:
Bonds payable $43,769
Plus: Discount on bonds payable 6,231 $50,000
c. Long-term liabilities:
Bonds payable $50,000
Less: Discount on bonds payable 5,919 $44,081
d. Long-term liabilities:
Bonds payable $44,081
Plus: Discount on bonds payable 5,919 $50,000
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