Laudie Company issued $400,000 of 5%, 10-year bonds on January 1, 2020, at 94. Interest is payable annually on January 1, 2021. Instructions: Prepare the journal entries to record the following events. a. The issuance of the bonds. b. The accrual of interest and amortization of the discount on December 31, 2020. c. The payment of interest on January 1, 2021. d. Calculate the carrying value of the bond on 12/31/20.
Laudie Company issued $400,000 of 5%, 10-year bonds on January 1, 2020, at 94. Interest is payable annually on January 1, 2021.
Instructions: Prepare the
a. The issuance of the bonds.
b. The accrual of interest and amortization of the discount on December 31, 2020.
c. The payment of interest on January 1, 2021.
d. Calculate the carrying
#2
Gridley Company issued $800,000, 11%, 10-year bonds on December 31, 2019, at 104. Interest is payable annually on December 31. Gridley Company uses the straight-line method to amortize bond premium or discount.
Instructions: Prepare the journal entries to record the following.
a. The issuance of the bonds.
b. The payment of interest December 31, 2020. (Extra credit for amortization of the premium entry)
c. The redemption of the bond at maturity
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