A Ten-Year Bond Issue of $400,000, Interest Rate of 9

question 40

Multiple Choice

A ten-year bond issue of $400,000, interest rate of 9% paid semiannually, is sold for $440,000 when the market rate is 8%. The bonds were not sold between interest dates and the straight-line amortization method is used. The entry to record the first interest payment would include

• A) a debit to Cash of $18,000.
• B) a debit to Bond Interest Payable of $18,000.
• C) a debit to Premium on Bonds Payable of $2,000.
• D) a credit to Bond Interest Expense of $16,000.

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Definitions:

Medical Model

A framework for understanding illnesses and disorders by identifying them as medical conditions with specific symptoms and treatments.

Thomas Szasz

A Hungarian-American psychiatrist known for his criticisms of psychiatry and the moral and scientific foundations of the concept of mental illness.

Moral Judgement

The process of determining the rightness or wrongness of actions based on ethical principles or social norms.

Abnormal Behaviour

Actions, thoughts, or emotions that deviate significantly from cultural or societal norms and may impair an individual’s functioning.