On January 1,2013,$1,200,000,5-Year,bonds with a Stated Rate of 10% Payable

question 165

Multiple Choice

On January 1,2013,$1,200,000,5-year,bonds with a stated rate of 10% payable annually were issued for cash of $1,295,844 when the market rate of interest was 8%.The first annual cash interest payment was $120,000 while that period's interest expense was calculated as $103,666.How would the company record the journal entry to record this first annual interest payment?

• A)Debit Interest Expense for $103,666,debit Premium on Bonds Payable for $16,334,and credit Cash for $120,000.
• B)Debit Interest Expense for $120,000 and credit Cash for $120,000.
• C)Debit Interest Expense for $16,334 and credit Cash for $16,334.
• D)Debit Interest Expense for $120,000,credit Discount on Bonds Payable for $16,334,and credit Cash for $103,666.
• E)Debit Cash for $1,295,844,credit Premium on Bonds Payable for $1,200,000,and credit Premium on Bonds Payable for $95,844.

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Definitions:

Rapes

The act of sexual assault, typically involving sexual intercourse or other forms of sexual penetration, carried out against a person without that person's consent.

Today

The present day or the actual time in which something happens.

Rapists

Individuals who engage in rape, the non-consensual sexual intercourse with another person through force, threat, or manipulation.

Strangers

Individuals who are unknown or unfamiliar to one another, often highlighting the absence of any personal acquaintance or friendship.