Question

Firm A issued a bond with a face value of $1,000 and an issue price of...

Firm A issued a bond with a face value of $1,000 and an issue price of $855.78. What is the journal entry for the bond issuance?

Select one:


Cash                                            1,000

Discount on bonds payable                    144.22
            Bonds payable                            855.78


Cash                                           855.78

Discount on bonds payable       144.22
            Bonds payable                           1,000


Bonds payable                           855.78

Discount on bonds payable       144.22
            Cash                                            1,000


Cash                                            1,000

Premium on bonds payable                    144.22
            Bonds payable                            855.78

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