Blanding Company Issues $1 000 000 of 8%, 10- Year

question 1

Multiple Choice

Blanding Company issues $1 000 000 of 8%, 10- year debentures at 98 on 28 February 2014. The debenture pays interest on 28 February and 31 August. The market rate of interest on the issue date was 10%. Assume Blanding uses the straight- line method for amortisation. The journal entry to record the first interest payment on 31 August 2014 would be a:

• A)debit to Discount on debentures payable for $1 000.
• B)debit to Cash for $40 000.
• C)debit to Interest expense for $39 000.
• D)debit to Interest expense for $41 000.

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Definitions:

Jealousy

An emotion arising from the fear of losing something or someone of value to another person, often associated with insecurity and desire.

Anticipatory Emotions

Emotions that are experienced in anticipation of a future event or outcome.

Goal

An objective or desired outcome that a person or organization aims to achieve.

Sustain Trust

The continuous process of maintaining the confidence and belief in the reliability, truth, or ability of someone or something.