Hillside issues $4,000,000 of 6%, 15-year bonds dated January 1, 2019, that pay interest semiannually on June 30 and December 31. The bonds are issued at a price of $4,895,980. Required: 1. Prepare the January 1 journal entry to record the bonds’ issuance. 2(a) For each semiannual period, complete the table below to calculate the cash payment. 2(b) For each semiannual period, complete the table below to calculate the straight-line premium amortization. 2(c) For each semiannual period, complete the table below to calculate the bond interest expense. 3. Complete the below table to calculate the total bond interest expense to be recognized over the bonds' life.
Hillside issues $4,000,000 of 6%, 15-year bonds dated January 1, 2019, that pay interest semiannually on June 30 and December 31. The bonds are issued at a price of $4,895,980.
Required:
1. Prepare the January 1
2(a) For each semiannual period, complete the table below to calculate the cash payment.
2(b) For each semiannual period, complete the table below to calculate the straight-line premium amortization.
2(c) For each semiannual period, complete the table below to calculate the bond interest expense.
3. Complete the below table to calculate the total bond interest expense to be recognized over the bonds' life.
4. Prepare the first two years of a straight-line amortization table.
5. Prepare the journal entries to record the first two interest payments.
- Record the issue of bonds with a par value of $4,000,000 on January 1, 2019 at an issue price of $4,895,980.
Complete this question by entering your answers in the tabs below.
- Req 1
Note: Enter debits before credits.
Date General Journal Debit Credit January 01 - Req 2A to 2C
For each semiannual period, compute (a) the cash payment, (b) the straight-line premium amortization, and (c) the bond interest expense.
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omplete this question by entering your answers in the tabs below.
- Req 3
Complete the below table to calculate the total bond interest expense to be recognized over the bonds' life.
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Prepare the first two years of a straight-line amortization table.
Req 4
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- Req 5
Prepare the journal entries to record the first two interest payments.
- Record the first interest payment on June 30.
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The question is based on the concept of the issue of securities.
As per Bartleby guidelines we are allowed to answer only the first 3 questions.
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