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Star Company issued bonds at par this year, and recorded the journal entry for the first payment of cash interest on June 30. What are the financial

Star Company issued bonds at par this year, and recorded the journal entry for the first payment of cash interest on June 30. What are the financial statement effects of this journal entry? (Assume that Star did not make any adjusting journal entries for accrued interest prior to recording the interest payment.)

Expenses increase and assets decrease

Expenses increase and liabilities increase

Liabilities decrease and stockholders' equity decreases

Assets decrease and liabilities decrease

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