(b)Prepare the journal entry to record the payment of interest and the discount amortization on December 31, 2022. (Credit accounttitles are automatically indented when amount is entered. Do not indent manually)Account Titles and ExplanationDateDec. 31.2022DebitCredit Cullumber Company issued $730,000, 9%, 10-year bonds on December 31, 2021, for $660,000. Interest is payable annually onDecember 31. Cullumber Company uses the straight-line method to amortize bond premium or discount.(a)Your Answer Correct AnswerYour answer is correct.Prepare the journal entry to record the issuance of the bonds. (Credit account titles are automatically indented when amount isentered. Do not indent manually.)DateDec 31,2021Account Titles and ExplanationCashDiscount on Bonds PayableBonds PayableDebit660,00070,000Credit730,000

Bonds can be issued at either par value or premium or at discount. If bond is issued for more than…

(b) Prepare the journal entry to record the payment of interest and the discount amortization on December 31, 2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually) Date Dec. 31. 2022 Account Titles and Explanation Debit Credit

(b) Prepare the journal entry to record the payment of interest and the discount amortization on December 31, 2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually) Date Dec. 31. 2022 Account Titles and Explanation Debit Credit

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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On June 30, 2017, Bramble Company issued 12% bonds with a par value of $760,000 due in 20 years. They were issued at 98 and were callable at 105 at any date after June 30, 2025. Because of lower interest rates and a significant change in the company's credit rating, it was decided to call the entire issue on June 30, 2026, and to issue new bonds. New 8% bonds were sold in the amount of $920,000 at 103; they mature in 20 years. Bramble Company uses straight-line amortization. Interest payment dates are December 31 and June 30. (a) (b) Prepare journal entries to record the redemption of the old issue and the sale of the new issue on June 30, 2026. Prepare the entry required on December 31, 2026, to record the payment of the first 6 months' interest and the amortization of premium on the bonds. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.…
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