The Entry to Record the Semiannual Payment and Amortization of the Discount

question 73

Multiple Choice

The entry to record the semiannual payment and amortization of the discount using the straight-line method on a 10%,$100,000,5-year bond issued at 97 would be to:

• A)debit Bond Interest Expense $5,000; credit Cash $5,000.
• B)debit Bond Interest Expense $5,300; credit Cash $5,000; credit Discount on Bonds Payable $300.
• C)debit Bond Interest Expense $10,000; credit Cash $10,000.
• D)debit Bond Interest Expense $13,000; credit Cash $10,000; credit Discount on Bonds Payable $3,000.

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