On the first day of the fiscal year, a company issues a $970,000, 9%, 5-year bond that pays semiannual interest of $43,650 ($970,000 x 9% × 1/2), receiving cash of $884,171. Journalize the entry for the issuance of the bonds.

Dr Cash 884,171

Dr Discount on bonds payable 85,829

    Cr Bonds payable 970,000

Explanation:

Since the bonds were sold at a lower price than par value, they were sold at a discount. That discount on bonds payable = total face value - cash received when issuing the bonds = $970,000 - $884,171 = $85,829

the answer is "b.the increased supply will create a surplus. "

the essential thought behind price controls is straightforward - utilize the power of law to modify the equilibrium of a market. for instance, the legislature may choose that the steel business needs to survive, and in this way pass a law to set a value floor on steel. this implies all steel sold must offer at or over the floor value, which must be set over the equilibrium cost for it to have any impact. the switch could likewise happen - the administration can choose that steel is excessively costly and set a value roof underneath its equilibrium value, with the goal that all steel must be sold at or beneath that ceiling.