Ward Corporation issues 5,000, 10-year, 8%, $1,000 bonds dated January 1, 2015, at 103. The journal entry to record the issuance will show a

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The bonds are issued at 103, which means they are issued at 103% of the face value. The premium is calculated as 3% of $5,000,000 (5,000 bonds x $1,000), which equals $150,000. Therefore, the credit to Premium on Bonds Payable is $150,000.

Ward Corporation Issues 5,000, 10-Year, 8%, $1,000 Bonds Dated January