Answer:
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Explanation:
 
        
             
        
        
        
Answer:
(a) Journalize the payment of the bond interest on January 1, 2022. 
Dr Interest payable - bonds payable 40,400
     Cr Cash 40,400
The interest expense on the bonds payable should have been accrued on the 2021 balance sheet, that is why we debit interest payable and not interest expense. 
(b) Assume that on January 1, 2022, after paying interest, Blossom calls bonds having a face value of $100,000. The call price is 103. Record the redemption of the bonds. 
Dr Bonds payable 100,000
Dr Call premium 3,000
     Cr Cash 103,000
(c) Prepare the adjusting entry on December 31, 2022, to accrue the interest on the remaining bonds.
interest expense = $405,000 x 8% = $32,400
Dr Interest expense - bonds payable 32,400
     Cr Interest payable - bonds payable 32,400
 
        
             
        
        
        
Answer: Option (d)
Explanation:
Under this case the write off will be as follow:
                                                                        Debit         Credit
Allowance for doubtful accounts                25,200  
Accounts receivables                                                     25,200
Here, in this case the Allowance for the doubtful accounts and Accounts receivables are further decreased as the outcome of the transaction made. Thus, there will be no further effect on working capital. Therefore the $30,000 that is bad debt would then be stated as the credit to allowance account. This will then decrease the working capital by $30,000.
 
        
             
        
        
        
Answer:
When an economy produces at full employment, but consumers, government, there is a recessionary gap - Option B.
Explanation:
According to the Keynesian perspective, firms produce output only if they expect it to sell.
While the availability of the factors of production determines a nation’s potential gross domestic product (GDP), the amount of goods and services actually being sold, known as real GDP depends on how much demand exists across the economy. 
Keynes termed a fall in the aggregate demand as a recessionary gap.
A recessionary gap refers to an economy operating at a level below its full-employment equilibrium. Under this condition, the level of real gross domestic product (GDP) is lower than the level of full employment, which puts downward pressure on prices in the long run.
Thus, when an economy produces at full employment, but consumers, government, there is a recessionary gap - Option B.