Question

Which of the following statements about bonds and notes is not correct?

A) A company can borrow the funds necessary to finance its activities using bonds or promissory notes.

B) Borrowings using bonds or notes are initially recorded with a journal entry that debits Cash and credits the relevant liability account.

C) The journal entry that records interest owed on bonds and notes includes a debit to Interest Expense and a credit to Interest Payable.

D) Bonds Payable and Notes Payable are always classified as noncurrent liability accounts.

Answer

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