ABC Company issues zero coupon bonds with a face value of \$60,000 at a 10% discount. How would the journal entry be balanced?

• A. Debit Cash \$54,000, Credit Bonds Payable \$54,000
• B. Debit Cash \$60,000, Credit Bonds Payable \$60,000
• C. Debit Cash \$54,000, Credit Bonds Payable \$60,000, Debit Discount on Bonds Payable \$6,000
• D. Debit Cash \$60,000, Credit Bonds Payable \$54,000, Credit Discount on Bonds Payable \$6,000

Answer: (C)