On January 1,2010,a Company Issued and Sold an $850,000,6%,5-Year Bond $$\begin{array} { | l | c | c | } \hline \text { Bond Interest Expense } & 25,500 & \\\hline \text { Cash } & & 25,500 \\\hline\end{array}$$

Multiple Choice

On January 1,2010,a company issued and sold an $850,000,6%,5-year bond payable and received proceeds of $825,000.Interest is payable each June 30 and December 31.The company uses the straight-line method to amortize the discount.The journal entry to record the first interest payment is:

A)
$$\begin{array} { | l | c | c | } \hline \text { Bond Interest Expense } & 25,500 & \\\hline \text { Cash } & & 25,500 \\\hline\end{array}$$
B)
$$\begin{array} { |l | r | r | } \hline \text { Bond Interest Expense } & 51,000 & \\\hline \text { Cash } & & 51,000 \\\hline\end{array}$$
C)
$$\begin{array} { | l | r | r | } \hline \text { Bond Interest Expense } & 28,000 & \\\hline \text { Discount on Bonds Payable } & & 2,500 \\\hline \text { Cash } & & 25,500 \\\hline\end{array}$$
D)
$$\begin{array} { | l | r | r | } \hline \text { Bond Interest Expense } & 23,000 & \\\hline \text { Discount on Bonds Payable } & 2,500 & \\\hline \text { Cash } & & 25,500 \\\hline\end{array}$$
E)
$$\begin{array} { | l | r | r | } \hline \text { Bond Interest Experise } & 25,500 & \\\hline \text { Discount on Bonds Payable } & 2,500 & \\\hline \text { Cash } & & 28,000 \\\hline\end{array}$$