Table 15-1 Nickle Industries Needs to Raise Capital for Expansion Purposes. Management

Table 15-1
Nickle Industries needs to raise capital for expansion purposes. Management is considering issuing $1,000,000 of 7.5%, 20-year bonds dated June 1, 2017 with interest payment dates of December 1
and June 1. Nickle's year end is December 31.
-Refer to Table 15-1. Assuming the bonds were issued on June 1,2017,at 103.875,and the company uses the straight-line method of amortization,the semiannual cash payment for interest on December 1,2017,would include a:

A) debit to Interest Expense for $36,531
B) credit to Cash for $75,000
C) debit to Discount on Bonds Payable for $1,938
D) debit to Interest Expense for $38,469