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Sheridan Company issued $6,500,000 of 6%, 10-year bonds for $5,614,000. The straight- line method of amortization is to be used. The journal entry to be recorded at the end of each year to record the accrued interest and the amortization of discount will include a a. credit to Discount on Bonds Payable for $59,120. b. debit to Bond Interest Expense for $390,000. c. credit to Discount on Bonds Payable for $88,600. d. credit to Cash for $453,850.

Sheridan Company issued $6,500,000 of 6%, 10-year bonds for $5,614,000. The straight- line method of amortization is to be used. The journal entry to be recorded at the end of each year to record the accrued interest and the amortization of discount will include a a. credit to Discount on Bonds Payable for $59,120. b. debit to Bond Interest Expense for $390,000. c. credit to Discount on Bonds Payable for $88,600. d. credit to Cash for $453,850.

FINANCIAL ACCOUNTING
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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6. Sheridan Company issued $6,500,000 of 6%, 10-year bonds for $5,614,000. The straight- line method of amortization is to be used. The journal entry to be recorded at the end of each year to record the accrued interest and the amortization of discount will include a a. credit to Discount on Bonds Payable for $59,120. b. debit to Bond Interest Expense for $390,000. c. credit to Discount on Bonds Payable for $88,600. d. credit to Cash for $453,850.
Transcribed Image Text:6. Sheridan Company issued $6,500,000 of 6%, 10-year bonds for $5,614,000. The straight- line method of amortization is to be used. The journal entry to be recorded at the end of each year to record the accrued interest and the amortization of discount will include a a. credit to Discount on Bonds Payable for $59,120. b. debit to Bond Interest Expense for $390,000. c. credit to Discount on Bonds Payable for $88,600. d. credit to Cash for $453,850.
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