Osbourne Oasis, Inc. is running short on cash. Osbourne decides to sell bonds to help with the cash problem. On January 1, 2022 Osbourne sells $1,000,000, 3-year bonds with a coupon rate of 3% payable annually. The market rate of interest was 4%. What would the journal entry be to record the first payment of interest on 12/31/22? Dr. Interest Expense $38,890, Cr. Bonds Payable $8,890, Cr. Cash $30,000 O Dr. Interest Expense $30000, Dr. Bonds Payable $8,890. Cr. Cash $38,890 O Dr. Interest Expense $30,000, Cr. Cash $30,000

Osbourne Oasis, Inc. is running short on cash. Osbourne decides to sell bonds to help with the cash problem. On January 1, 2022 Osbourne sells $1,000,000, 3-year bonds with a coupon rate of 3% payable annually. The market rate of interest was 4%. What would the journal entry be to record the first payment of interest on 12/31/22? Dr. Interest Expense $38,890, Cr. Bonds Payable $8,890, Cr. Cash $30,000 O Dr. Interest Expense $30000, Dr. Bonds Payable $8,890. Cr. Cash $38,890 O Dr. Interest Expense $30,000, Cr. Cash $30,000

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 2PA: On July 1, Somerset Inc. issued $200,000 of 10%, 10-year bonds when the market rate was 12%. The...

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