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leonid
20 days ago
11

On January 1, Year 1, Liang Corporation issues a $100,000 bond at a discount for $95,083. The coupon rate is 10% and the market

interest rate is 12%. The bonds pay interest semiannually on June 30 and December 31. The journal entry to record the interest payment on June 30, Year 1 will include which of the following entries?
(1)Debit interest expense $5,705
(2)Credit discount on bonds payable $750(Interest expense ($95,083*6%)-Cash interest paid ($100,000*5%) = Discount 705)
Business
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