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On January 1, a company issues bonds dated January 1 with a par value of...

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Accounting

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On January 1, a company issues bonds dated January 1 with a par value of $230,000. The bonds mature in 5 years. The contract rate is 7%, and interest is paid semiannually on June 30 and December 31. The market rate is 6% and the bonds are sold for $239,811. The journal entry to record the issuance of the bond is: Multiple Choice Debit Cash $239,811; credit Premium on Bonds Payable $9,811; credit Bonds Payable $230,000. Debit Cash $239,811; credit Discount on Bonds Payable $9,811; credit Bonds Payable $230,000. Debit Bonds Payable $230,000; debit Bond Interest Expense $9,811; credit Cash $239,811. o Debit Cash $239,811; credit Bonds Payable $239,811. Debit Cash $230,000; debit Premium on Bonds Payable $9,811; credit Bonds Payable $239,811

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