I need help with a math problem

Anonymous
timer Asked: Nov 19th, 2015
account_balance_wallet $5

Question Description

On October 1, 2010 Macklin Corporation issued 5%, 10-year bonds with a face value of $1,000,000 at 104. Interest is paid on October 1 and April 1, with any premiums or discounts amortized on a straight-line basis.

The entry to record the issuance of the bonds would include a credit of

a. $25,000 to interest Payable.
b. $40,000 to Discount on Bonds Payable.
c. $960,000 to Bonds Payable.
d. $40,000 to Premium on Bonds Payable.

Tutor Answer

anusha_reddy
School: Carnegie Mellon University

Thank you for the opportunity to help you with your question!

On October 1, 2010 Macklin Corporation issued 5%, 10-year bonds with a face value of $1,000,000 at 104. Interest is paid on October 1 and April 1, with any premiums or discounts amortized on a straight-line basis.

The entry to record the issuance of the bonds would include a credit of
d. $40,000 to Premium on Bonds Payable.

Please let me know if you need any clarification. I'm always happy to answer your questions.

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Anonymous
awesome work thanks

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