The city of Tinsel issues $10,000,000 face value of general obligation bonds for $9,800,000. The bonds will be used for the construction of new city streets. What journal entry should the city make in its Capital Projects Fund to record the issuance of these bonds?

Select one:

A.

Cash --- Dr- 10,000,000

Other Financing Source - Long-Term Debt issued --- Cr 10,000,000

B.

Cash --- Dr. 9,800,000

Other Financing Source - Long-Term Debt issued --- Cr 9,800,000

C.

Cash --- Dr. 9,800,000

Other Financing Use - Bond Issue Discount --- Dr. 200,000

Other Financing Source - Long-Term Debt issued --- Cr 9,800,000

Revenue - Bond Issue Premium --- Cr 200,000

D.

Cash --- Cr 9,800,000

Other Financing Use - Bond issue discount --- Dr. 200,000

Other Financing Source - Long-Term Debt issued --- Cr 10,000,000