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On January 1, Boston Enterprises issues bonds that have a $3,400,000 par value, mature in 20 years, and pay 9% 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) 98 and (b) 102.

On January 1, Boston Enterprises issues bonds that have a $3,400,000 par value, mature in 20 years, and pay 9% 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) 98 and (b) 102.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On January 1, Boston Enterprises issues bonds that have a $3,400,000 par value, mature in 20 years, and pay 9% 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) 98 and (b) 102.

Required 1 Required 2 Required 3 On January 1, Boston Enterprises issues bonds that have a $3,400,000 par value, mature in 20 years, and pay 9% interest semiannually on June 30 and December 31. The bonds are sold at par. Prepare journal entries to record (a) the issuance of bonds on January 1, (b) the first interest payment on June 30, and (c interest payment on December 31. 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) 98 and (b) 102. View transaction list Complete this question by entering your answers in the tabs below. Journal entry worksheet Required 1 Required 2 Required 3 < 1 3 How much interest will the issuer pay (in cash) to the bondholders every six months? Record the interest payment on December 31. Semiannual Rate Semiannual Cash Par (maturity) Value Interest Payment < Required 1 Required 2 > Note: Enter debits before credits. Date General Journal Debit Credit December 31 Required 1 Required 2 Required 3 Prepare journal entries to record (a) the issuance of bonds on January 1, (b) the first interest payment on June 30, and (c) the sec interest payment on December 31. View transaction list Record entry Clear entry View general journal Journal entry worksheet Required 1 Required 2 Required 3 1 2 3 > Prepare the journal entry for issuance assuming the bonds are issued at (a) 98 and (b) 102. Record the issue of bonds at par on January 1. View transaction list Journal entry worksheet Note: Enter debits before credits. Date General Journal Debit Credit 1 2 January 01 Record the issue of bonds at 98. Note: Enter debits before credits. Date General Journal Debit Credit January 01 Record entry Clear entry View general journal Required 1 Required 2 Required 3 Record entry Clear entry View general journal Prepare journal entries to record (a) the issuance of bonds on January 1, (b) the first interest payment on June 30, and (c) th interest payment on December 31. View transaction list Required 1 Required 2 Required 3 Prepare the journal entry for issuance assuming the bonds are issued at (a) 98 and (b) 102. Journal entry worksheet View transaction list 1 2 > Journal entry worksheet Record the interest payment on June 30. < 1 2 Record the issue of bonds at 102. Note: Enter debits before credits. Date General Journal Debit Credit Note: Enter debits before credits. June 30 Date General Journal Debit Credit January 01 PIC COLLAGE Record entry Clear entry View general journal Record entry Clear entry View general journal
Transcribed Image Text:Required 1 Required 2 Required 3 On January 1, Boston Enterprises issues bonds that have a $3,400,000 par value, mature in 20 years, and pay 9% interest semiannually on June 30 and December 31. The bonds are sold at par. Prepare journal entries to record (a) the issuance of bonds on January 1, (b) the first interest payment on June 30, and (c interest payment on December 31. 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) 98 and (b) 102. View transaction list Complete this question by entering your answers in the tabs below. Journal entry worksheet Required 1 Required 2 Required 3 < 1 3 How much interest will the issuer pay (in cash) to the bondholders every six months? Record the interest payment on December 31. Semiannual Rate Semiannual Cash Par (maturity) Value Interest Payment < Required 1 Required 2 > Note: Enter debits before credits. Date General Journal Debit Credit December 31 Required 1 Required 2 Required 3 Prepare journal entries to record (a) the issuance of bonds on January 1, (b) the first interest payment on June 30, and (c) the sec interest payment on December 31. View transaction list Record entry Clear entry View general journal Journal entry worksheet Required 1 Required 2 Required 3 1 2 3 > Prepare the journal entry for issuance assuming the bonds are issued at (a) 98 and (b) 102. Record the issue of bonds at par on January 1. View transaction list Journal entry worksheet Note: Enter debits before credits. Date General Journal Debit Credit 1 2 January 01 Record the issue of bonds at 98. Note: Enter debits before credits. Date General Journal Debit Credit January 01 Record entry Clear entry View general journal Required 1 Required 2 Required 3 Record entry Clear entry View general journal Prepare journal entries to record (a) the issuance of bonds on January 1, (b) the first interest payment on June 30, and (c) th interest payment on December 31. View transaction list Required 1 Required 2 Required 3 Prepare the journal entry for issuance assuming the bonds are issued at (a) 98 and (b) 102. Journal entry worksheet View transaction list 1 2 > Journal entry worksheet Record the interest payment on June 30. < 1 2 Record the issue of bonds at 102. Note: Enter debits before credits. Date General Journal Debit Credit Note: Enter debits before credits. June 30 Date General Journal Debit Credit January 01 PIC COLLAGE Record entry Clear entry View general journal Record entry Clear entry View general journal
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