One Thousand Bonds with a Face Value of $1,000 Each

question 44

Multiple Choice

One thousand bonds with a face value of $1,000 each, are sold at 104. The entry to record the issue is
a)
$\begin{array} { l l r r } & \text { Cash } & 1,040,000 & \\ & \text { Bonds Payable } & & 1,000,000 \\& \text { Interest Payable } & & 40,000 \\\end{array}$
b)
$\begin{array} { l l r r } & \text { Cash } & &961,538 \\ & \text { Bonds Payable } &&& 961,538 \\\end{array}$
c )
$\begin{array} { l l r r } & \text { Cash } & & 1,040,000 \\ & \text { Bonds Payable } & &&1,040,000 \\\end{array}$
d)
$\begin{array} { l l r r } & \text { Cash } &1,000,000& \\ & \text { Interest Expense } & 40,000 & \\& \text { Bonds Payable } & & 1,040,000\\\end{array}$

• A) Choice A
• B) Choice B
• C) Choice C
• D) Choice D

---

Definitions:

Unemployment Rate

The unemployment rate is the percentage of the labor force that is jobless and actively looking for employment.

Natural Rate

The rate of output at which an economy operates without inflationary pressures, often referred to as the natural rate of unemployment.

Phillips Curve

A concept in economics that indicates an inverse relationship between the rate of unemployment and the rate of inflation within an economy.

Inflation Rate

The rise in the average cost of goods and services throughout an economy over a specified period.