Blossom Company issues $1,000,000, 10-year, 10% bonds at 95, with interest payable each January 1. (a) Prepare the journal entry to record the sale of these bonds on January 1, 2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Jan. 1
Blossom Company issues $1,000,000, 10-year, 10% bonds at 95, with interest payable each January 1. (a) Prepare the journal entry to record the sale of these bonds on January 1, 2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Jan. 1
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
100%
Please answer part (a) and (b) completely and correctly fill out every single box with the right information

Transcribed Image Text:**Blossom Company Bond Issuance Details**
**Bond Details:**
- **Issuer:** Blossom Company
- **Amount:** $1,000,000
- **Term:** 10 years
- **Interest Rate:** 10%
- **Issue Price:** 95% of face value
- **Interest Payment Date:** January 1 each year
**Requirement (a):**
**Task:**
Prepare the journal entry for the sale of the bonds on January 1, 2022.
**Instructions:**
- Note that credit account titles are automatically indented when amounts are entered.
- Do not manually indent entries.
**Journal Entry Format:**
| Date | Account Titles and Explanation | Debit | Credit |
|---------|---------------------------------|-------|--------|
| Jan. 1 | | | |
| | | | |
| | | | |
This entry will reflect the accounting impact of issuing the bonds at a discount, recording both the cash received and the obligation to pay back more than the amount received, adjusted for the discount.

Transcribed Image Text:### Journal Entry Preparation for Bond Sale
**Scenario**: Assume that the bonds mentioned were sold for $108. You are required to prepare the journal entry to record this bond sale, dated January 1, 2022.
**Note**: Credit account titles will be automatically indented when the amount is entered. Do not indent manually.
#### Journal Entry Template
| Date | Account Titles and Explanation | Debit | Credit |
|--------|--------------------------------|-------|--------|
| Jan. 1 | | | |
| | | | |
| | | | |
Fill in the necessary account titles and amounts under "Debit" and "Credit" to accurately record the transaction following standard accounting principles.
Expert Solution

This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps

Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you


Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,

Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,


Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,

Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,

Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON

Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education

Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education