lmn-corporation-issues-300000-of-4-bonds-payable-with-interest-payable-semi-annu

Question

LMN Corporation issues $300,000 of 4% bonds payable with interest payable semi-annually. What is the semi-annual interest payment, and what is the journal entry?

Accepted Answer

Interest payment $6,000; Debit Interest Expense $6,000, Credit Cash $6,000.

Answer

Interest payment $12,000; Debit Interest Expense $12,000, Credit Cash $12,000.

Answer

Interest payment $6,000; Debit Cash $6,000, Credit Interest Expense $6,000.

Answer

Interest payment $3,000; Debit Interest Expense $3,000, Credit Cash $3,000.

LMN Corporation issues \$300,000 of 4% bonds payable with interest payable semi-annually. What is the semi-annual interest payment, and what is the journal entry?