Silcon Company issued P800,000 of 6%, 10-year bonds on one of its interest dates for P690,960 to yield an effective annual rate of 8%. The effective-interest method of amortization is to be used. The journal entry on the first interest payment date, to record the payment of interest and amortization of discount will include a Group of answer choices credit to Cash for P55,277 debit to Bond Interest Expense for P48,000 credit to Discount on Bonds Payable for P7,277. debit to Bond Interest Expense for P64,000

Silcon Company issued P800,000 of 6%, 10-year bonds on one of its interest dates for P690,960 to yield an effective annual rate of 8%. The effective-interest method of amortization is to be used. The journal entry on the first interest payment date, to record the payment of interest and amortization of discount will include a Group of answer choices credit to Cash for P55,277 debit to Bond Interest Expense for P48,000 credit to Discount on Bonds Payable for P7,277. debit to Bond Interest Expense for P64,000

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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Oriole Company issued $636,000 of 10%, 20-year bonds on January 1, 2020, at 103. Interest is payable semiannually on July 1 and January 1. Oriole Company uses the straight-line method of amortization for bond premium or discount. Prepare the journal entries to record the following. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) (a) The issuance of the bonds. (b) The payment of interest and the related amortization on July 1, 2020. (c) The accrual of interest and the related amortization on December 31, 2020. Date Account Titles and Explanation 1/1/20 7/1/20 12/31/20 Debit Credit
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