orrecting Error in Accounting for Bonds Payable On June 30, 2020, Williams Inc. issued 8-year, $100,000, 5% bonds, priced at $82,522 to yield 8%, with cash interest payable semiannually on June 30 and December 31. In 2021, after the financial statements had been issued, Williams discovered that the entry to record interest expense on December 31, 2020, was recorded incorrectly as follows: debit to Interest Expense for $2,500 and a credit to Cash for $2,500. Required Record the correcting entry in 2021, ignoring income taxes. Company policy is to amortize bond discounts or premiums using the effective interest method. Note: Round your answers to the nearest whole dollar. Date Account Name Dr. Cr. Jan.1, 2021 Answer Answer Answer Answer Answer Answer
orrecting Error in Accounting for Bonds Payable On June 30, 2020, Williams Inc. issued 8-year, $100,000, 5% bonds, priced at $82,522 to yield 8%, with cash interest payable semiannually on June 30 and December 31. In 2021, after the financial statements had been issued, Williams discovered that the entry to record interest expense on December 31, 2020, was recorded incorrectly as follows: debit to Interest Expense for $2,500 and a credit to Cash for $2,500. Required Record the correcting entry in 2021, ignoring income taxes. Company policy is to amortize bond discounts or premiums using the effective interest method. Note: Round your answers to the nearest whole dollar. Date Account Name Dr. Cr. Jan.1, 2021 Answer Answer Answer Answer Answer Answer
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Correcting Error in Accounting for Bonds Payable
On June 30, 2020, Williams Inc. issued 8-year, $100,000, 5%
Required
Record the correcting entry in 2021, ignoring income taxes. Company policy is to amortize bond discounts or premiums using the effective interest method.
Note: Round your answers to the nearest whole dollar.
| Date | Account Name | Dr. | Cr. |
|---|---|---|---|
| Jan.1, 2021 | Answer | Answer | Answer |
|
Answer
|
Answer | Answer |
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