Question 14 Cotton Company issued $500,000 of 7%, 10-year bonds on one of its interest dates for $431.850 to yield an effective annual rate of 9%. The effective interest method of amortization is used. Interest is paid annually. The journal entry on the first interest payment date, to record the payment of interest and amortization of discount will include a O credit to Cash for $38,867 O credit to Discount on Bonds Payable for $3,867. O debit to Interest Expense for $45,000. O debit to Interest Expense for $35,000.

Quentions 14