Bonds with a face value of $450,000 were issued at 97. The entry to record the issuance will include a debit to the Discount on Bonds Payable account for

Question

Quizplus · Accepted Answer

The discount on bonds payable is calculated as the difference between the face value and the issued price. Here, the bonds were issued at 97% of their face value, so the discount is 3% of $450,000, which equals $13,500 (0.03 * $450,000).

Bonds with a Face Value of $450,000 Were Issued at 97