On January 1, when the market interest rate was 8 percent, Seton Corporation completed a $160,000, 7 percent bond Issue for $149,265. The bonds pay interest each December 31 and mature in 10 years. Assume Seton Corporation uses the effective-interest method to amortize the bond discount. 10-15 (Algo) Part 1 and 2 equired: & 2. Prepare the required journal entries to record the bond issuance and the first interest payment on December 31. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Round your answers to the nearest whole dollar.) No 1 Date January 01 General Journal Cash Discount on Bonds Payable Bonds Payable 000 Debit 149,265 10,735 Credit 160,000
On January 1, when the market interest rate was 8 percent, Seton Corporation completed a $160,000, 7 percent bond Issue for $149,265. The bonds pay interest each December 31 and mature in 10 years. Assume Seton Corporation uses the effective-interest method to amortize the bond discount. 10-15 (Algo) Part 1 and 2 equired: & 2. Prepare the required journal entries to record the bond issuance and the first interest payment on December 31. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Round your answers to the nearest whole dollar.) No 1 Date January 01 General Journal Cash Discount on Bonds Payable Bonds Payable 000 Debit 149,265 10,735 Credit 160,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![E10-15 (Algo) Part 1 and 2
On January 1, when the market interest rate was 8 percent, Seton Corporation completed a $160,000, 7 percent bond
issue for $149,265. The bonds pay interest each December 31 and mature in 10 years. Assume Seton Corporation uses the
effective-interest method to amortize the bond discount.
Required:
1. & 2. Prepare the required journal entries to record the bond issuance and the first interest payment on December 31. (If no entry is
required for a transaction/event, select "No Journal Entry Required" in the first account field. Round your answers to the
nearest whole dollar.)
No
1
2
Date
January 01
December 31
General Journal,
Cash
Discount on Bonds Payable
Bonds Payable
Interest Expense
Discount on Bonds Payable
Cash
0 0 0
000
Debit
149,265
10,735
5,971
Credit
160,000
5,600
371](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F72825ab2-4ab6-4f85-b223-04864e4f0a53%2F09a4d484-7be6-43de-b594-a22a52c128f6%2Fmq4cih_processed.jpeg&w=3840&q=75)
Transcribed Image Text:E10-15 (Algo) Part 1 and 2
On January 1, when the market interest rate was 8 percent, Seton Corporation completed a $160,000, 7 percent bond
issue for $149,265. The bonds pay interest each December 31 and mature in 10 years. Assume Seton Corporation uses the
effective-interest method to amortize the bond discount.
Required:
1. & 2. Prepare the required journal entries to record the bond issuance and the first interest payment on December 31. (If no entry is
required for a transaction/event, select "No Journal Entry Required" in the first account field. Round your answers to the
nearest whole dollar.)
No
1
2
Date
January 01
December 31
General Journal,
Cash
Discount on Bonds Payable
Bonds Payable
Interest Expense
Discount on Bonds Payable
Cash
0 0 0
000
Debit
149,265
10,735
5,971
Credit
160,000
5,600
371
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
![Horngren's Cost Accounting: A Managerial Emphasis…](https://www.bartleby.com/isbn_cover_images/9780134475585/9780134475585_smallCoverImage.gif)
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
![Intermediate Accounting](https://www.bartleby.com/isbn_cover_images/9781259722660/9781259722660_smallCoverImage.gif)
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
![Financial and Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781259726705/9781259726705_smallCoverImage.gif)
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education