A company prepared the following journal entry: Which of the following statements correctly describes the effect of this journal entry on the financial statements?
Cash
Premium on bonds payable
Bonds payable
A) Total liabilities increase by the amount of the debit to cash.
B) Premium on bonds payable is reported on the balance sheet as a contra-liability account.
C)Total liabilities increase by the amount of the credit to bonds payable.
D)The credit to bonds payable is the amount reported as a cash flow from financing activities.

Question

A company prepared the following journal entry: Which of the following statements correctly describes the effect of this journal entry on the financial statements?
Cash
Premium on bonds payable 
Bonds payable
A) Total liabilities increase by the amount of the debit to cash.
B) Premium on bonds payable is reported on the balance sheet as a contra-liability account.
C)Total liabilities increase by the amount of the credit to bonds payable.
D)The credit to bonds payable is the amount reported as a cash flow from financing activities.

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The Answer of A company prepared the following journal entry: Which of the following statements correctly describes the effect of this journal entry on the financial statements?
Cash
Premium on bonds payable 
Bonds payable
A) Total liabilities increase by the amount of the debit to cash.
B) Premium on bonds payable is reported on the balance sheet as a contra-liability account.
C)Total liabilities increase by the amount of the credit to bonds payable.
D)The credit to bonds payable is the amount reported as a cash flow from financing activities.

A Company Prepared the Following Journal Entry: Which of the Following