Indigo Corporation issued $519,600 of 7% bonds on November 1, 2025, for $558,684. The bonds were dated November 1, 2025, and mature in 10 years, with interest payable each May 1 and November 1. Indigo uses the effective-interest method with an effective rate of 6%. Click here to view factor tables. Prepare Indigo's December 31, 2025, adjusting entry. (Round intermediate calculations to 5 decimal places, e.g. 1.25124 and final answers to O decimal places, eg. 38,548. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) Date Account Titles and Explanation December 31, Interest Expense 2025 Premium on Bonds Payable Interest Payable Debit 5,587 30,785 Credit 36.372
Indigo Corporation issued $519,600 of 7% bonds on November 1, 2025, for $558,684. The bonds were dated November 1, 2025, and mature in 10 years, with interest payable each May 1 and November 1. Indigo uses the effective-interest method with an effective rate of 6%. Click here to view factor tables. Prepare Indigo's December 31, 2025, adjusting entry. (Round intermediate calculations to 5 decimal places, e.g. 1.25124 and final answers to O decimal places, eg. 38,548. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) Date Account Titles and Explanation December 31, Interest Expense 2025 Premium on Bonds Payable Interest Payable Debit 5,587 30,785 Credit 36.372
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Indigo Corporation issued $519,600 of 7% bonds on November 1, 2025, for $558,684. The bonds were dated November 1, 2025, and
mature in 10 years, with interest payable each May 1 and November 1. Indigo uses the effective-interest method with an effective rate
of 6%.
Click here to view factor tables.
Prepare Indigo's December 31, 2025, adjusting entry. (Round intermediate calculations to 5 decimal places, e.g. 1.25124 and final answers
to O decimal places, eg. 38,548. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles
are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.)
Date
Account Titles and Explanation
December 31,
Interest Expense
2025
Premium on Bonds Payable
Interest Payable
Debit
5,587
30,785
Credit
36.372
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