Paulson Company issues 6%, four-year bonds, on January 1 of this year, with a par value of $110,000 and semiannual interest payments. Carrying Value $103,067 103,934 104,801 Semiannual Period-End Unamortized Discount (0) (1) (2) January 1, issuance June 30, first payment December 31, second payment $6,933 6,066 5,199 Use the above straight-line bond amortization table and prepare journal entries for the following. (a) The issuance of bonds on January 1. (b) The first interest payment on June 30. (c) The second interest payment on December 31. View transaction list View journal entry worksheet Debit Credit No Date General Journal Cash 103,067 January 01 Discount on bonds payable 6,933 110,000 Bonds payable June 30 Bond interest expense 2,433 867 Discount on bonds payable Cash 3. December 31 Bond interest expense 2,433 Discount on bonds payable 867 Cash 1,566

Paulson Company issues 6%, four-year bonds, on January 1 of this year, with a par value of $110,000 and semiannual interest payments. Carrying Value $103,067 103,934 104,801 Semiannual Period-End Unamortized Discount (0) (1) (2) January 1, issuance June 30, first payment December 31, second payment $6,933 6,066 5,199 Use the above straight-line bond amortization table and prepare journal entries for the following. (a) The issuance of bonds on January 1. (b) The first interest payment on June 30. (c) The second interest payment on December 31. View transaction list View journal entry worksheet Debit Credit No Date General Journal Cash 103,067 January 01 Discount on bonds payable 6,933 110,000 Bonds payable June 30 Bond interest expense 2,433 867 Discount on bonds payable Cash 3. December 31 Bond interest expense 2,433 Discount on bonds payable 867 Cash 1,566

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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Paulson Company issues 6%, four-year bonds, on January 1 of this year, with a par value of $110,000 and semiannual interest payments. Semiannual Period-End Unamortized Discount (0) (1) (2) January 1, issuance June 30, first payment December 31, second payment $6,933 6,066 5,199 Carrying Value $103,067 103,934 104,801 Use the above straight-line bond amortization table and prepare journal entries for the following. (a) The issuance of bonds on January 1. (b) The first interest payment on June 3O. (c) The second interest payment on December 31. es View transaction list Journal entry worksheet 3 Record the issue of bonds with a par value of $110,000 cash January 1. Note: Enter debits before credits. Date General Journal Debit Credit January 01 Prev 1 of 2 Next > 中

Discount Amortization On the first day of the fiscal year, a company issues a $4,600,000, 7%, 6-year bond that pays semiannual interest of $161,000 ($4,600,000 x 7% x ), receiving cash $3,988,436. Journalize the first interest payment and the amortization of the related bond discount. Round to the nearest dollar. If an amount box does not require an entry, leave it blank. Interest Expense Discount on Bonds Payable Cash 161,000
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Entries for issuing bonds and amortizing premium by straight-line method Smiley Corporation wholesales repair products to equipment manufacturers. On April 1, 20Y1, Smiley issued $20,000,000 of 5-year, 9% bonds at a market (effective) interest rate of 8%, receiving cash of $20,811,010. Interest is payable semiannually on April 1 and October 1. a. Journalize the entry to record the issuance of bonds on April 1, 20Y1. If an amount box does not require an entry, leave it blank. b. Journalize the entry to record the first interest payment on October 1, 20Y1, and amortization of bond premium for 6 months, using the straight-line method. If an amount box does not require an entry, leave it blank. c. Why was the company able to issue the bonds for $20,811,010 rather than for the face amount of $20,000,000? The market rate of interest is the contract rate of interest.