Exhibit 14-5 Joseph Company Had Underwriters Prepare a Bond Issue for $100,000

Exhibit 14-5
Joseph Company had underwriters prepare a bond issue for $100,000 9%, ten-year bonds dated January 1, 2014 The bonds were issued on March 1, 2014 at 102 plus accrued interest on. Expenses connected with the issue totaled
$5,000 and were deducted in arriving at the net proceeds. Joseph amortizes premiums and discounts using the straight-line method.
-Refer to Exhibit 14-5. The entry to record the issue would include

A) a debit to Bonds Payable for $100,000.
B) a debit to Interest Expense for $1,500.
C) a credit to Bonds Payable for $102,000.
D) a credit to Interest Expense for $1,500

Correct Answer:

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