Yarborough Enterprises issued a $500,000 of bonds payable with a 10% interest rate at a price of 104. The journal entry to record the issuance of this bond included a:
a. Debit to Cash, $500,000
b. Debit to Bonds Payable, $500,000
c. Credit to Premium on Bonds Payable, $20,000
d. Credit to Cash, $500,000
Frequently Asked Questions
What scientific concept do you need to know in order to solve this problem?
Our tutors have indicated that to solve this problem you will need to apply the Premium on Bonds concept. You can view video lessons to learn Premium on Bonds. Or if you need more Premium on Bonds practice, you can also practice Premium on Bonds practice problems.
What is the difficulty of this problem?
Our tutors rated the difficulty ofYarborough Enterprises issued a $500,000 of bonds payable wi...as medium difficulty.