Use the Present Value and Future Value Tables Included in Appendix

Use the present value and future value tables included in Appendix 8 and on the textbook companion website.
-On January 1, 2012, Lawton Corporation issued 10-year, $1,000,000 bonds with a stated interest rate of 10%. The effective interest rate is 10% and interest is paid semi-annually on January 1 and July 1. The journal entry to record the bond issuance would include a

A) Debit to Cash of $1,000,000
B) Credit to Cash of $1,000,000
C) Debit to Bonds Payable of $1,000,000
D) Credit to Bond Interest Expense of $1,000,000

Correct Answer:

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