Smith Company has issued a $40,000 face value, 7%, five - year bond at 94 . What will be the journal entry at the maturity of the bond for the last semiannual interest payment if the company uses the straight - line method of amortization? C. Interest Expense Gain on Bonds Payable Cash 1,160 240 1,400 D. Interest Expense 1,640 Cash Disnount on Ronds Pavable 1,400 240