Crosson Company Uses the Straight-Line Method of Amortization and Had

Multiple Choice

Crosson Company uses the straight-line method of amortization and had a ten-year, 12 percent, $1,000,000 bond issue outstanding that had been sold at a $12,000 discount in 2015. The bonds pay interest on June 30 and December 31, and the company's fiscal year end is December 31. The journal entry on June 30, 2018, will include:

A) a $6,000 credit to Cash.
B) a $1,200 credit to Premium on Bonds Payable.
C) a $58,800 debit to Interest Expense
D) a $600 credit to Discount on Bonds Payable.