6 Bond Corporation issues 5,000, 10-year, 8%, $1,000 bonds dated January 1, 2017, at 103. The journal entry to record the issuance will show a A) debit to Cash of $5,000,000. credit to Premium on Bonds Payable for $150,000. C) credit to Bonds Payable for $5,030,000. B) D) credit to Cash for $5,150,000. E) None of the above 7 Premium on Bonds Payable A) has a debit balance. B) is a contra account. C) is considered to be a reduction in the cost of borrowing. D) is deducted from bonds payable on the balance sheet. E) None of the above 8 If bonds payable were issued initially at a discount, the carrying value of the bonds at a balance sheet date will be calculated by A) deducting the amount of discount amortized between the issuance date and the balance sheet date from the face value. B) deducting the balance of unamortized bond discount from the face value. C) adding the balance of unamortized bond discount to the face value. D) adding the amount of discount amortized between the issuance date and the balance sheet date to the face value. None of the above E)

6 Bond Corporation issues 5,000, 10-year, 8%, $1,000 bonds dated January 1, 2017, at 103. The journal entry to record the issuance will show a A) debit to Cash of $5,000,000. credit to Premium on Bonds Payable for $150,000. C) credit to Bonds Payable for $5,030,000. B) D) credit to Cash for $5,150,000. E) None of the above 7 Premium on Bonds Payable A) has a debit balance. B) is a contra account. C) is considered to be a reduction in the cost of borrowing. D) is deducted from bonds payable on the balance sheet. E) None of the above 8 If bonds payable were issued initially at a discount, the carrying value of the bonds at a balance sheet date will be calculated by A) deducting the amount of discount amortized between the issuance date and the balance sheet date from the face value. B) deducting the balance of unamortized bond discount from the face value. C) adding the balance of unamortized bond discount to the face value. D) adding the amount of discount amortized between the issuance date and the balance sheet date to the face value. None of the above E)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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