Pharoah Company issued $$530,000$ of $5-$year, $5\%$ bonds at $97$ on January $1,2027.$ The bonds pay interest annually.

$($a$1)$

Your answer is correct.

Prepare the journal entry to record the issuance of the bonds. $($Credit account titles are automatically indented when amount is entered. Do not indent manually.$)$

Account Titles and Explanation

Debit

Credit

Cash

$514100$

Discount on Bonds Payable

Bonds Payable

$530000$

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List of Accounts

Attempts: $1$ of $5$ used

$($a$2)$

X Your answer is incorrect.

Compute the total cost of borrowing for these bonds.

Total cost of borrowing

$