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Torrey Corporation Issued $1,000,000 of Ten-Year, 10 Percent Bonds Payable

Question 62

Multiple Choice

Torrey Corporation issued $1,000,000 of ten-year, 10 percent bonds payable dated January 1, 2016. The market rate of interest at that time was 11 percent. The journal entry to record this transaction will include a:


A) debit to Discount on Bonds Payable.
B) credit to Premium on Bonds Payable.
C) credit to Discount on Bonds Payable.
D) credit to Cash.

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