Blossom Company issues $360,000, 20-year, 10% bonds at 101. Prepare the journal entry to record the sale of these bonds on June 1,2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)Account Titles and ExplanationDebitCredit

Bonds is a debt market instruments. It is promise to repay the principal along with principal.Issue of bond at a premium :- Bond selling price is above 100. cash received is more than bond principal.Issue of bond at a premium:-Date Particular Debit creditJune 1 cash A/c 363,600 bond payable A/c 360,000 premium on bond payable A/c 3,600 (To record to issuer of bond at premium)Face value of bond= $360,000Cash received from bond= 360000 x 101%= $363,600Premium on bond=cash received from bond- face value of bondPremium on bond= 363,600-360000=$3600Premium on bond= $3600Hence, this is the required answer.

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Blossom Company issues $360,000, 20-year, 10% bonds at 101. Prepare the journal entry to record the sale of these 2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually) Account Titles and Explanation Debit Credit nas on

Blossom Company issues $360,000, 20-year, 10% bonds at 101. Prepare the journal entry to record the sale of these 2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually) Account Titles and Explanation Debit Credit nas on

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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