On December 31,2018,Country Living Sales has 10-year Bonds Payable of $89,000 and Discount on Bonds Payable of $2350.How will this be shown on the December 31,2018 Balance Sheet?

Question

Quizplus · Accepted Answer

The Bonds Payable of $89,000 should be shown on the balance sheet at its carrying amount, which is the face value of the bonds less any unamortized discount. Therefore, the Discount on Bonds Payable of $2,350 should be subtracted from the Bonds Payable of $89,000, resulting in a carrying amount of $86,650. Choice A reflects this calculation.

On December 31,2018,Country Living Sales Has 10-Year Bonds Payable of $89,000