On january 1 hurley corporation issues 2000000 5-year 12, Ask an Expert

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On January 1, Hurley Corporation issues $2,000,000, 5-year, 12% bonds at 96 with interest payable on July 1 and January 1. The entry on December 31 to record accrued bond interest and the amortization of bond discount using the straight-line method will include a:

a. debit to Interest Expense, $120,000.

b. debit to Interest Expense, $240,000.

c. credit to Discount on Bonds Payable, $8,000.

d. credit to Discount on Bonds Payable, $16,000.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9406570

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