On January 1, Boston Enterprises issues bonds that have a $1,750,000 par value, mature in 20 years, and pay 10% interest semiannually on June 30 and December 31. The bonds are sold at par. 1. How much interest will the issuer 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) 97 and (b) 103. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare the journal entry for issuance assuming the bonds are issued at (a) 97 and (b) 103. View transaction list Journal entry worksheet < 1 Record the issue of bonds at 97. 2 Note: Enter debits before credits. Date January 01 Record entry General Journal Cash ....... Discount on bonds payable Bonds payable Clear entry Debit 1,697,500 Credit 1,750,000 View general journal > < Prev 2 of 10 Next
On January 1, Boston Enterprises issues bonds that have a $1,750,000 par value, mature in 20 years, and pay 10% interest semiannually on June 30 and December 31. The bonds are sold at par. 1. How much interest will the issuer 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) 97 and (b) 103. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare the journal entry for issuance assuming the bonds are issued at (a) 97 and (b) 103. View transaction list Journal entry worksheet < 1 Record the issue of bonds at 97. 2 Note: Enter debits before credits. Date January 01 Record entry General Journal Cash ....... Discount on bonds payable Bonds payable Clear entry Debit 1,697,500 Credit 1,750,000 View general journal > < Prev 2 of 10 Next
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable
Section: Chapter Questions
Problem 16E
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