A bond with a face value of \$200,000 is issued at 110%. What is the journal entry for the issuance?

• A. Debit Cash \$220,000, Credit Bonds Payable \$220,000
• B. Debit Cash \$220,000, Credit Bonds Payable \$200,000, Credit Premium on Bonds Payable \$20,000
• C. Debit Cash \$200,000, Credit Bonds Payable \$220,000, Debit Premium on Bonds Payable \$20,000
• D. Debit Cash \$200,000, Credit Bonds Payable \$200,000, Credit Premium on Bonds Payable \$20,000

Answer: (B)