How is discount on bonds payable treated on the balance sheet?
A) Discount on bonds payable is a contra asset account.
B) Discount on bonds payable is a contra stockholders' equity account.
C) Discount on bonds payable is a contra account to bonds payable.
D) Discount on bonds payable is an adjunct account to bonds payable.

Question

Quizplus · Accepted Answer

Discount on bonds payable is considered a contra account to bonds payable, meaning it is subtracted from the bonds payable account on the balance sheet to reflect the net amount of the bonds.

How Is Discount on Bonds Payable Treated on the Balance