Answer:
cash paid for bond interest that is $790,000
so correct option is a. $790,000
Explanation:
given data
interest expense = $800,000
interest payable increased = $8,000
bond discount decreased = $2,000
to find out
cash paid for bond interest
solution
we get here cash paid for bond interest that is
cash paid for bond interest = Bond Interest Expense - increase in Bond Interest - decrease in Bond Discount ......................1
and here increase in Bond Interest Payable $8,000 of the $800,000 has not been paid in cash yet so it is = $8000 and
Bond Discount in which $800,000 includes $2,000 of discount amortization that is non cash transaction so it is $2000
so that Cash Paid for Bond Interest is $790,000
correct option is a.$790,000
