A Company Prepared the Following Journal Entry: Which of the Following

question 100

Multiple Choice

A company prepared the following journal entry: Which of the following statements incorrectly describes the effect of this journal entry on the financial statements?
Cash
Discount on bonds payable
Bonds payable

• A) Total liabilities increase by only the amount of the credit to bonds payable.
• B) Discount on bonds payable is reported on the balance sheet as a contra-liability account.
• C)Assets increase by the amount of the debit to cash.
• D)The cash inflow (debit) is reported as a cash flow from financing activities.

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Definitions:

Actively Erupting

A volcanic state characterized by ongoing expulsion of lava, ash, or other volcanic material.

Conical-Shaped Hill

A landform with a circular base and sloping sides that converge to a point at the top, resembling the shape of a cone.

Fresh Ash Layers

Recent deposits of volcanic ash, consisting of fine particles of volcanic glass, created during volcanic eruptions.

Flat-Topped Mesa

A broad, flat, elevated landform with steep sides, commonly found in arid and semi-arid regions.