Issuing Bonds at Face AmountThe first day of the fiscal year, a company issues a $350,000, 6%, 10-year bond that pays semiannual interest of $10,500 ($350,000 x 6% x 2 year),receiving cash of $350,000.a. Journalize the entry to record the issuance of the bonds. If an amount box does not require an entry, leave it blank.b. Journalize the entry to record the first interest payment. If an amount box does not require an entry, leave it blank.C. Journalize the entry to record the payment of the principal on the maturity date. If an amount box does not reguire an entry, leave it blank.0000

Journal Entry: Journal entry is the act of keeping records of transactions in an accounting journal.…

Answered: The first day of the fiscal year, a…

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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Issuing Bonds at Face Amount On January 1, the first day of the fiscal year, Designer Fabric Inc. issues a $750,000, 6%, 10-year bond that pays semiannual interest of $22,500 ($750,000 x 6% x ½ year), receiving cash of $750,000. (a) Journalize the entry to record the issuance of the bonds. If an amount box does not require an entry, leave it blank. (b) Journalize the entry to record the first interest payment on June 30. If an amount box does not require an entry, leave it blank. (c) Journalize the entry to record the payment of the principal on the maturity date. If an amount box does not require an entry, leave it blank.
A-2
On the first day of the fiscal year, a company issues a $1,450,000, 5%, five-year bond that pays semiannual interest of $36,250 ($1,450,000 × 5% × ½), receiving cash of $1,408,720. Journalize the first interest payment and the amortization of the related bond discount. Round to the nearest dollar. Refer to the Chart of Accounts for exact wording of account titles. Chart of Accounts CHART OF ACCOUNTS General Ledger ASSETS 110 Cash 111 Petty Cash 121 Accounts Receivable 122 Allowance for Doubtful Accounts 126 Interest Receivable 127 Notes Receivable 131 Merchandise Inventory 141 Office Supplies 191 Land 194 Office Equipment 195 Accumulated Depreciation-Office Equipment LIABILITIES 210 Accounts Payable 221 Salaries Payable 231 Sales Tax Payable 232 Interest Payable 241 Notes Payable 251 Bonds Payable 252 Discount on Bonds Payable 253 Premium on Bonds Payable EQUITY 311 Common Stock 312…
Issuing bonds at a discount On the first day of the fiscal year, a company issues a $4,000,000, 9%, 10-year bond that pays semiannual interest of $180,000 ($4,000,000 x 9% × 1), receiving cash of $3,750,756. Journalize the bond issuance. If an amount box does not require an entry, leave it blank. Cash Discount on Bonds Payable Bonds Payable Feedback 3,750,756 0 0 4,000,000 Check My Work Bonds Payable is always recorded at face value. Any difference in issue price is reflected in a premium or discount account.
On July 1, a company issues a $1,000,000, 7%, five-year bond that pays semiannual interest of $35,000 ($1,000,000 × 7% × 1/2), receiving cash of $884,171. Required: Journalize the first interest payment and the amortization of the related bond discount/premium using the straight-line method. Round answers to the nearest dollar. Refer to the Chart of Accounts for exact wording of account titles.
On the first day of the fiscal year, a company issues a $784,000, 6%, 10-year bond that pays semiannual interest of $23,520 ($784,000 x 6% x 1/2), receiving cash of $823,200. Journalize the entry for the first interest payment and amortization of premium using the straight-line method. If an amount box does not require an entry, leave it blank. OUD
On the first day of the fiscal year, a company issues an $2,750,000, 8%, five-year bond that pays semiannual interest of $110,000 ($2,750,000 x 8% x ½), receiving cash of $2,938,110. Journalize the first interest payment and the amortization of the related bond premium. Round to the nearest dollar. Refer to the Chart of Accounts for exact wording of account titles. Chart of Accounts CHART OF ACCOUNTS General Ledger ASSETS 110 Cash 111 Petty Cash 121 Accounts Receivable 122 Allowance for Doubtful Accounts 126 Interest Receivable 127 Notes Receivable 131 Merchandise Inventory 141 Office Supplies 191 Land 194 Office Equipment 195 Accumulated Depreciation-Office Equipment LIABILITIES 210 Accounts Payable 221 Salaries Payable 231 Sales Tax Payable 232 Interest Payable 241 Notes Payable 251 Bonds Payable 252 Discount on Bonds Payable 253 Premium on Bonds Payable EQUITY 311 Common Stock…
Issuing Bonds at a Discount On the first day of the fiscal year, a company issues a $8,200,000, 9%, 10-year bond that pays semiannual interest of $369,000 ($8,200,000 × 9% × ½), receiving cash of $7,689,049. Journalize the bond issuance. If an amount box does not require an entry, leave it blank. Cash fill in the blank fill in the blank Discount on Bonds Payable fill in the blank fill in the blank Bonds Payable fill in the blank fill in the blank
On the first day of the fiscal year, a company issues an $994,000, 7%, 5-year bond that pays semiannual interest of $34,790 ($994,000 x 7% x 1/2), receiving cash of $934,400. Journalize the entry for the first interest payment and the amortization of the related bond discount using the straight-line method. If an amount box does not require an entry, leave it blank. Previous
On the first day of the fiscal year, a company issues a $1,000,000, 10%, 5-year bond that pays semiannual interest of $50,000 ($1,000,000 x 10% x 1/2), receiving cash of $884,174. Journalize the entry for the issuance of the bonds. If an amount box does not require an entry, leave it blank.
Issuing Bonds at Face Amount On January 1, the first day of the fiscal year, Designer Fabric Inc. issues a $250,000, 10%, 10-year bond that pays semiannual interest of $12,500 ($250,000 x 10% x 2 year), receiving cash of $250,000. (a) Journalize the entry to record the issuance of the bonds. If an amount box does not require an entry, leave it blank. (b) Journalize the entry to record the first interest payment on June 30. If an amount box does not require an entry, leave it blank. (c) Journalize the entry to record the payment of the principal on the maturity date. If an amount box does not require an entry, leave it blank. 88
Issuing Bonds at a Discount On the first day of the fiscal year, a company issues a $8,700,000, 9%, 9-year bond that pays semiannual interest of $391,500 ($8,700,000 × 9% × ½), receiving cash of $7,287,000. Journalize the bond issuance. If an amount box does not require an entry, leave it blank.

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