On January 1, 2020, Shamrock Corporation issued $590,000 of 9% bonds, due in 8 years. The bonds were issued for $558,028, and pay interest each July 1 and January 1. Shamrock uses the effective-interest method.
On January 1, 2020, Shamrock Corporation issued $590,000 of 9% bonds, due in 8 years. The bonds were issued for $558,028, and pay interest each July 1 and January 1. Shamrock uses the effective-interest method.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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![On January 1, 2020, Shamrock Corporation issued $590,000 of 9% bonds, due in 8 years. The
bonds were issued for $558,028, and pay interest each July 1 and January 1. Shamrock uses the
effective-interest method.
Prepare the company's journal entries for (a) the January 1 issuance, (b) the July 1 interest
payment, and (c) the December 31 adjusting entry. Assume an effective-interest rate of 10%.
(Round intermediate calculations to 6 decimal places, e.g. 1.251247 and final answer to O decimal places,
e.g. 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 amount is entered. Do not indent manually.)
No. Date Account Titles and Explanation
(a)
(b)
A
Cash
Debit
SUPPORT](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fbec20c07-3200-474b-9b3d-a0700570ce7e%2Fab056f7f-9d30-43a7-9159-061b6f1d9642%2Faft5ekc_processed.jpeg&w=3840&q=75)
Transcribed Image Text:On January 1, 2020, Shamrock Corporation issued $590,000 of 9% bonds, due in 8 years. The
bonds were issued for $558,028, and pay interest each July 1 and January 1. Shamrock uses the
effective-interest method.
Prepare the company's journal entries for (a) the January 1 issuance, (b) the July 1 interest
payment, and (c) the December 31 adjusting entry. Assume an effective-interest rate of 10%.
(Round intermediate calculations to 6 decimal places, e.g. 1.251247 and final answer to O decimal places,
e.g. 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 amount is entered. Do not indent manually.)
No. Date Account Titles and Explanation
(a)
(b)
A
Cash
Debit
SUPPORT
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