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On January 1, a company issued and sold a $320,000, 5%, 10-year bond payable, and received proceeds of $315,000. Interest is payable each June 30 and December 31. The company uses the straight-line method to amortize the discount. The carrying value of the bonds immediately after the first interest payment is:

Respuesta :

jepessoa

Answer:

$315,250

Explanation:

total discount on bonds payable = $320,000 - $315,000 = $5,000

amortization of bond discount per coupon payment = $5,000 / 20 = $250

bonds carrying value after the first coupon payment is made = $315,000 + $250 = $315,250

Dr Interest expense 8,250

    Cr Cash 8,000

    Cr Discount on bonds payable 250

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