Help Save & Exit Submit 5 On January 1. Year 1 Residence Company issued bonds with a $50,000 face value. The bonds were issued at 96 resulting in a 4% discount. They had a 20 year term and a stated rate of interest of 7%. The company amortizes the discount on a straight-line basis. Which of the following shows how the recognition of interest expense will affect Residence's financial statements on December 31, Year 1? art 5 of 6 Balance Sheet Carrying Value Income Statement Statement of Rev. 1-1 Exp . 1 : Net Inc. | Cash Flows 48,000 48,800 52,000 48,000 FA 48,000 FA 2,080 50,000 48,000 52,000 50,000 NA NA NA NA