On January 1, a Company Issues Bonds Dated January 1

question 64

Multiple Choice

On January 1, a company issues bonds dated January 1 with a par value of $300,000. The bonds mature in 5 years. The contract rate is 9%, and interest is paid semiannually on June 30 and December 31. The market rate is 8% and the bonds are sold for $312,177. The journal entry to record the issuance of the bond is:

• A) Debit Cash $312,177; credit Discount on Bonds Payable $12,177; credit Bonds Payable $300,000.
• B) Debit Cash $300,000; debit Premium on Bonds Payable $12,177; credit Bonds Payable $312,177.
• C) Debit Bonds Payable $300,000; debit Interest Expense $12,177; credit Cash $312,177.
• D) Debit Cash $312,177; credit Premium on Bonds Payable $12,177; credit Bonds Payable $300,000.
• E) Debit Cash $312,177; credit Bonds Payable $312,177.

Understand the concept and characteristics of hydrogen bonds.

Comprehend how nonionic solids behave in solution.

Grasp the concept of polarity in water molecules.

Differentiate between acids and bases in solution.

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Definitions:

Psychodynamic Therapy

A therapeutic approach aiming to explore the psychological forces underlying emotional issues, focusing on unresolved conflicts and influences from the past.

Personality Reshaping

The process of making significant and lasting changes to an individual's personality traits and behaviors, often through psychological interventions.

Biological Therapy

Treatment that uses substances derived from living organisms to fight disease, including some types of cancer and chronic illnesses.

Cognitive-behavioral Therapy

A form of psychotherapy that aims to improve mental health by challenging and changing unhelped cognitive distortions and behaviors, improving emotional regulation, and developing personal coping strategies.