Question : 111. The journal entry a company records for the issuance of : 1234236

111. The journal entry a company records for the issuance of bonds when the contract rate is less than the market rate would be 
A. debit Bonds Payable, credit Cash
B. debit Cash and Discount on Bonds Payable, credit Bonds Payable
C. debit Cash, credit Premium on Bonds Payable and Bonds Payable
D. debit Cash, credit Bonds Payable

112. When the market rate of interest was 11%, Welch Corporation issued $100,000, 8%, 10-year bonds that pay interest semiannually. Using the straight-line method, the amount of discount or premium to be amortized each interest period would be 
A. $4,000
B. $896
C. $17,926
D. $1,793

113. The journal entry a company records for the payment of interest, interest expense, and amortization of bond discount is 
A. debit Interest Expense, credit Cash and Discount on Bonds Payable
B. debit Interest Expense, credit Cash
C. debit Interest Expense and Discount on Bonds Payable, credit Cash
D. debit Interest Expense, credit Interest Payable and Discount on Bonds Payable

114. The journal entry a company records for the payment of interest, interest expense, and amortization of bond premium is 
A. debit Interest Expense, credit Cash and Premium on Bonds Payable
B. debit Interest Expense, credit Cash
C. debit Interest Expense and Premium on Bonds Payable, credit Cash
D. debit Interest Expense, credit Interest Payable and Premium on Bonds Payable

115. On January 1, 2007, the Kings Corporation issued 10% bonds with a face value of $100,000. The bonds are sold for $96,000. The bonds pay interest semiannually on June 30 and December 31 and the maturity date is December 31, 2011. Kings records straight-line amortization of the bond discount. The bond interest expense for the year ended December 31, 2007, is 
A. $9,200
B. $9,800
C. $10,400
D. $10,800

116. If $1,000,000 of 8% bonds are issued at 103, the amount of cash received from the sale is 
A. $1,060,000
B. $970,000
C. $1,000,000
D. $1,030,000

117. If the market rate of interest is greater than the contractual rate of interest, bonds will sell 
A. at a premium.
B. at face value.
C. at a discount.
D. only after the stated rate of interest is increased.

118. The interest expense recorded on an interest payment date is increased 
A. only if the market rate of interest is less than the stated rate of interest on that date.
B. by the amortization of premium on bonds payable.
C. by the amortization of discount on bonds payable.
D. only if the bonds were sold at face value.

119. On January 1, 2007, $1,000,000, 5-year, 10% bonds, were issued for $970,000. Interest is paid semiannually on January 1 and July 1. If the issuing corporation uses the straight-line method to amortize discount on bonds payable, the semiannual amortization amount is 
A. $6,000.
B. $5,808.
C. $3,000
D. $5,000

120. If the market rate of interest is 10%, a $10,000, 12%, 10-year bond that pays interest semiannually would sell at an amount 
A. less than face value.
B. equal to the face value.
C. greater than face value.
D. that cannot be determined.