On January 1,2013,$800,000,5-Year,bonds with a Contract Rate of 8% Payable

question 76

Multiple Choice

On January 1,2013,$800,000,5-year,bonds with a contract rate of 8% payable annually were issued for cash of $684,627 when the market rate of interest was 12%.The first annual cash interest payment was $64,000 while that period's interest expense was calculated as $82,155.24.How would the company record the journal entry to record this first annual interest payment?

• A)Debit Cash for $684,627,debit Discount on Bonds Payable for $115,373,and credit Bonds Payable for $800,000.
• B)Debit Interest Expense for $82,155.24 and credit Cash for $82,155.24.
• C)Debit Interest Expense for $64,000.00 and credit Cash for $64,000.00.
• D)Debit Interest Expense for $82,155.24,credit Discount on Bonds Payable for $18,155.24,and credit Cash for $64,000.00.
• E)Debit Interest Expense for $64,000.00,debit Discount on Bonds Payable for $18,155.24 and credit Cash for $82,155.24.

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Definitions:

Folkway

A folkway is a customary social behavior that is informally enforced in a society, representing the everyday norms and practices.

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refers to any physical, emotional, sexual harm, or neglect inflicted upon a child by a caregiver or another person.

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Penalties or rewards for conduct concerning a social norm to maintain social order.