A company issued 9%, 15-year bonds with a par value of $560,000 that pay interest semiannually....

A company issued 9%, 15-year bonds with a par value of $560,000 that pay interest semiannually. The market rate on the date of issuance was 9%. The journal entry to record each semiannual interest payment is:

Multiple Choice

Debit Bond Interest Expense $510,000; credit Cash $510,000.
No entry is needed, since no interest is paid until the bond is due.
Debit Bond Interest Expense $50,400; credit Cash $50,400.
Debit Bond Interest Expense $25,200; credit Cash $25,200.
Debit Bond Interest Payable $37,333; credit Cash $37,333.

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Expert Solution

ekkarill92 answered 1 year ago

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