Table 9-1

The Simpson Corporation issued 8%, 10-year term bonds on January 1, 2017, with a face value of $1,000,000. Interest is payable semi-annually on June 30 and December 31. The bonds were issued for $875,378 to yield an effective annual rate of 10%. Simpson uses the straight-line method of amortization.

Refer to Table 9-1. The journal entry to record the issuance of the bonds will include a:

A. credit to Bonds Payable for $875, 378.

B. debit to Cash for $1,000,000.

C. Debit to Discount on Bonds Payable for $124,622.

D. debit to Interest Payable $124,622.

PLEASE Include all the work