Exercise 10-7A Two accounting cycles for bonds issued at face value On January 1, 2011, Watson Corp. issued $220,000 of 10-year, 6 percent bonds at their face amount. Interest is payable on December 31 of each year with the first payment due December 31, 2011. Required Prepare all the general journal entries related to these bonds for 2011 and 2012.

Exercise 10-7A Two accounting cycles for bonds issued at face value On January 1, 2011, Watson Corp. issued $220,000 of 10-year, 6 percent bonds at their face amount. Interest is payable on December 31 of each year with the first payment due December 31, 2011. Required Prepare all the general journal entries related to these bonds for 2011 and 2012.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Cornerstone Exercise 9-46 (Appendix 9A) Bond Issue Price On December 31, 2014, Callahan Auto issued $900,000 of 9%, 10-year bonds. Interest is payable semiannually on June 30 and December 31. Required: What is the issue price if the bonds are sold to yield 8%? Follow the format shown in Present Value tables as you complete the requirement. If required, round your calculations and final answer to the nearest whole dollar.$
Problem 1. A company "I aim to get at least 90 out of 100 for this exam" (further in a text as Company) issued $45 million of 30-year, 7 percent bonds on April 1, 2015, at 105. Interest is due on May 31 and November 30 each year, Company's fiscal year ends on December 31. Prepare the following journal entries: All journals required to be recorded in 2015 related to this bond. May 31, 2016, to pay interest and to amortize the bond premium. b. c. April 1, 2045, to pay interest, amortize the bond premium, and retire the bonds at maturity.
EXERCISE 21-3 On January 1, Murphy, Inc., issues 7 percent, 20-year bonds with a face value of $650,000 at 96. Interest is payable on June 30 and December 31. Journalize the following entries: a. Issuance of the bonds b. Payment of semiannual interest on June 30 and December 31 C. Adjusting entry to amortize the discount on December 31, the company's year end
Question 2. Recording and Reporting Bonds Robinson Inc., as a public company, issues $3 million of 10%, 10-year, corporate bonds on January 1, 2010. The bonds pay interest on every January 1 after the issuance. The company uses the effective-interest amortization method. Required: If market rate on issue date is 10%, prepare journal entries for the issuance and journal entries at the end of December 2010, 2011, and 2019. If market rate on issue date is 12%, prepare journal entries for the issuance and journal entries at the end of December 2010 and 2011. If market rate on issue date is 8%, prepare journal entries for the issuance and journal entries at the end of December 2010, 2011, and 2019.
7
Which of the following is correct with respect to closing out overapplied manufacturing overhead to Cost of Goods Sold versus closing it out to Work-in-Process Inventory, Finished Goods Inventory, and Cost of Goods Sold? The balance in the Work-in-Process account after allocation will be higher if the overapplied overhead is closed out by allocating it to all appropriate accounts. a. b. None of given answer is correct. С. Cost of Goods Sold will be lower if the overapplied overhead is closed out by allocating it to the inventory accounts as well as to Cost of Goods Sold. d. Operating income will be higher if all of the overapplied overhead is closed out to Cost of Goods Sold. e. The balance in the Work-in-Process account after allocation will be the same under either method. Clear my choice
Subject: accounting
Question 6 (i) On 1 April, year 1, Happy Corporation issues $50 million of 10%, 30-year bonds payable at par. Interest on the bonds is payable semiannually each 1 April and 1 October. The journal entry to record the first cash payment to bondholders on 1 October, year 1, will include: A: A credit to Cash of $5,000,000. B: A credit to Interest Payable of $2,500,000. C: A debit to Bonds Payable of $5,000,000. D: A debit to Interest Expense of $2,500,000. (ii) ABC Manufacturing Company sold a vehicle for cash of $70,000 with a loss of $10,000 recognized. The accumulated depreciation amounted to $140,000. The original cost of the asset must have been: A: $130,000. B: $150,000. C: $200,000. D: $220,000.
Exercise 10-3 (Algo) Recording bond issuance and interest LO P1 On January 1, Boston Enterprises Issues bonds that have a $1,600,000 par value, mature in 20 years, and pay 8% Interest semiannually on June 30 and December 31. The bonds are sold at par. 1. How much Interest will Boston pay (in cash) to the bondholders every six months? 2. Prepare Journal entries to record (a) the issuance of bonds on January 1, (b) the first interest payment on June 30, and (c) the second Interest payment on December 31. 3. Prepare the journal entry for Issuance assuming the bonds are issued at (a) 98 and (b) 102. Complete this question by entering your answers in the tabs below. Required 1 Required 2 How much interest will Boston pay (in cash) to the bondholders every six months? Semiannual Cash Interest Payment Par (maturity) Value Required 3 X Semiannual Rate Required 1 Required 2 >