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On January 1, Multichip Corporation Issued $2,000,000, 10-Year, 8% Bonds

Question 92

Multiple Choice

On January 1, Multichip Corporation issued $2,000,000, 10-year, 8% bonds at 102. The journal entry to record this transaction would include a:


A) credit to bonds payable $2,040,000.
B) debit to discount on bonds payable $40,000.
C) debit to cash $2,000,000.
D) credit to premium on bonds payable $40,000.

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