Lassen Corporation issued ten-year term bonds on January 1, 2010, with a face value of $800,000 . The face interest rate is 6 percent and interest is payable semi-annually on June 30 and December 31 . The bonds were issued for $690,960 to yield an effective annual rate of 8 percent. The effective interest method of amortization is to be used. The entry to record the bond interest expense on the
first interest payment date is: (Round answer to the nearest dollar.)
a. Bond Interest Expense 24,000
Cash 24,000
b. Bond Interest Expense 27,638
Unamortized Bond Discount 3,638
Cash 24,000
c. Bond Interest Expense 27,638
Cash 27,638
d. Bond Interest Expense 27,638
Unamortized Bond Discount 27,638
B
You might also like to view...
When one party is substituted for another in a contract, this is called which of the following:
a. Levi b. Subordination c. Novation d. Curtilage.
To counter the effect of increasing diversity as a barrier to effective communication, many large organizations are ________
A) instituting diversity-training programs B) grouping workers according to ethnicity or nationality C) using only e-mail as the recommended channel of communication D) avoiding the hiring of people with diverse backgrounds