bonds dated March 1, with interest payments on September 1 and March 1.RequiredPrepare journal entries to record the following events, assuming that the bonds were sold at 100 plus accrued interest on July 1.a. The bond issuance.b. Payment of the semiannual interest on September 1.c. Accrual of bond interest expense at December 31.d. Payment of the semiannual interest on March 1 of the following year.e. Retirement of $200,000 of the bonds at 104 on March 1, Year 3 (immediately after the interest payment on that date). General Journal Date Description Debit Credit a. Jul.1 Bonds Payable
Bonds Payable
Richard, Inc., which closes its books on December 31, is authorized to issue $600,000 of six percent, 20‑year bonds dated March 1, with interest payments on September 1 and March 1.
Required
Prepare journal entries to record the following events, assuming that the bonds were sold at 100 plus accrued interest on July 1.
a. The bond issuance.
b. Payment of the semiannual interest on September 1.
c. Accrual of bond interest expense at December 31.
d. Payment of the semiannual interest on March 1 of the following year.
e. Retirement of $200,000 of the bonds at 104 on March 1, Year 3 (immediately after the interest payment on that date).
| General Journal | |||
|---|---|---|---|
| Date | Description | Debit | Credit |
| a. | |||
| Jul.1 |
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| Bonds Payable |
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| Issuance of bonds plus accrued interest. | |||
| b. | |||
| Sept.1 | Bond Interest Payable |
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| To record semiannual interest payment. | |||
| c. | |||
| Dec.31 |
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| To accrue interest expense. | |||
| d. | |||
| Mar.1 | Bond Interest Payable |
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| To record semiannual interest payment. | |||
| e. | |||
| Mar.1 | Bonds Payable |
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| To record retirement of bonds. |
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