Chapter 10 Quiz A company received $783,600 for bonds having a total face value

Question

Chapter 10 Quiz A company received $783,600 for bonds having a total face value of $800,000 5. Required information Use the information above to answer the following question. What journal entry would be made to record this bond issuance? Debit Cash for $783,600 debit Discount on Bonds Payable for $16,400, and credit Bonds Payable for $800,.000 O Debit Cash for $800,000 and credit Bonds Payable for $800,000 O Debit Cash for $800,000, credit Bonds Payable for $783,600, and credit Intorest Payable for $16,400 O Debit Cash for $800,000 credit Discount on Bonds Payable for $16.400, and credit Bonds Payable for $783.600 6. Required information Use the information above to answer the following question i the balance sheet dete corresponded with the date of the bond issue, whet carrying value would be reported on the balance sheet? $783.600 $816,400 O $791,800

Explanation / Answer

5) Journal entry of bond issuance :

so answer is a) debit cash for $783600, debit discount on bonds payable for $16400 and credit bonds payable for $800000

6) If balance sheet if corresponded with the date of bonds issue, carrying value is $783600

so answer is a) $783600

Date accounts & explanation debit credit Cash a/c 783600 Discount on bonds payable 16400       Bonds payable a/c 800000 (To record issuance of bonds payable)

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