A Company Issues 6%, 10 Year Bonds with a Par

question 76

Multiple Choice

A company issues 6%, 10 year bonds with a par value of $500,000 at 98. The current market rate of interest is 7%. Interest is payable each June 30 and December 31. The company uses the straight-line method to amortize the discount. The journal entry to record the first interest payment is:

---

Definitions:

Critical Mass

A sufficient amount of something needed to maintain or start a process, especially in the context of nuclear reactions or creating social change.

Sample

A part of a population that is studied to reach conclusions about the entire population.

Case Study

A descriptive research method in which a single individual or a small number of persons are studied in great depth.

Naturalistic Study

Research conducted in a real-world setting without the manipulation or control of variables, observing natural behaviors.