Bonds Are Issued for $20,000 at Face Value with 6 $$\begin{array} { | c | c | } \hline \text { Bond Interest Expense } & 1,200 \\\hline \text { Bond Interest Payable } & 1,200 \\\hline\end{array}$$

question 50

Multiple Choice

Bonds are issued for $20,000 at face value with 6% interest on October 1.What is the adjusting entry on December 31?

• A)
• \[\begin{array} { | c | c | }
• \hline \text { Bond Interest Expense } & 1,200 \\
• \hline \text { Bond Interest Payable } & 1,200 \\
• \hline
• \end{array}\]
• B)
• \[\begin{array} { | c | c | }
• \hline \text { Bond Interest Expense } & 300 \\
• \hline \text { Bond Interest Payable } & 300 \\
• \hline
• \end{array}\]
• C)
• \[\begin{array} { | c | c | }
• \hline \text { Bond Interest Payable } & 300 \\
• \hline \text { Bond Interest Expense } & 300 \\
• \hline
• \end{array}\]
• D)
• \[\begin{array} { | c | c | }
• \hline \text { Bond Interest Payable } & 1,200 \\
• \hline \text { Bond Interest Expense } & 1,200 \\
• \hline
• \end{array}\]

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Definitions:

Federal Government

The national government of a federal country, such as the United States, responsible for enacting and enforcing laws applicable across all states and territories.

Expenditures

Refers to the amount of money spent by either an individual, business, or government on goods and services.

Budget Deficit

The financial situation in which government expenditures exceed revenues.

Social Security

A government program that provides financial assistance to people with inadequate or no income, especially the elderly, disabled, and families with dependent children.