On January 1, $881,000, 5-year, 10% bonds were issued for $854,570. Interest is paid semiannually on January 1 and July 1. If the issuing company uses the straight-line method to amortize a discount on bonds payable, the semiannual amortization amount is ၁ a. $44,050 b. $26,430 ၁ c. $5,286

On January 1, $881,000, 5-year, 10% bonds were issued for $854,570. Interest is paid semiannually on January 1 and July 1. If the issuing company uses the straight-line method to amortize a discount on bonds payable, the semiannual amortization amount is ၁ a. $44,050 b. $26,430 ၁ c. $5,286

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 14MC: Whirlie Inc. issued $300,000 face value, 10% paid annually, 10-year bonds for $319,251 when the...

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Question

On January 1, $881,000, 5-year, 10% bonds were issued for $854,570.
Interest is paid semiannually on January 1 and July 1. If the issuing company
uses the straight-line method to amortize a discount on bonds payable, the
semiannual amortization amount is
a. $44,050
b. $26,430
c. $5,286
d. $2,643

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