Volunteer Inc. issued bonds with a $650,000 face value, 12% interest rate, and a 4-year term on July 1, 2018 and received $700,000. Interest is payable annually. The premium is amortized using the straight-line method A. July 1, 2018: entry to record issuing the bonds B. June 30, 2019: entry to record payment of interest to bondholders C. June 30, 2019: entry to record amortization of premium D. June 30, 2020: entry to record payment of interest to bondholders E. June 30, 2020: entry to record amortization of premium Prepare journal entries for the above transactions. If an amount box does not require an entry, leave it blank. A. July 1, 2018 Cash Bonds Payable Premium on Bonds Payable B. June 30, 2019 Interest Expense Cash C. June 30, 2019 Premium on Bonds Payable Interest Expense D. June 30, 2020 Interest Expense Cash E. June 30, 2020 Premium on Bonds Payable Interest Expense 86
Volunteer Inc. issued bonds with a $650,000 face value, 12% interest rate, and a 4-year term on July 1, 2018 and received $700,000. Interest is payable annually. The premium is amortized using the straight-line method A. July 1, 2018: entry to record issuing the bonds B. June 30, 2019: entry to record payment of interest to bondholders C. June 30, 2019: entry to record amortization of premium D. June 30, 2020: entry to record payment of interest to bondholders E. June 30, 2020: entry to record amortization of premium Prepare journal entries for the above transactions. If an amount box does not require an entry, leave it blank. A. July 1, 2018 Cash Bonds Payable Premium on Bonds Payable B. June 30, 2019 Interest Expense Cash C. June 30, 2019 Premium on Bonds Payable Interest Expense D. June 30, 2020 Interest Expense Cash E. June 30, 2020 Premium on Bonds Payable Interest Expense 86
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
![Volunteer Inc. issued bonds with a $650,000 face value, 12% interest rate, and a 4-year term on July 1, 2018 and received $700,000. Interest is payable annually. The premium is amortized using the straight-line method.
A. July 1, 2018: entry to record issuing the bonds
B. June 30, 2019: entry to record payment of interest to bondholders
C. June 30, 2019: entry to record amortization of premium
D. June 30, 2020: entry to record payment of interest to bondholders
E. June 30, 2020: entry to record amortization of premium
Prepare journal entries for the above transactions. If an amount box does not require an entry, leave it blank.
A. July 1, 2018
Cash
Bonds Payable
Premium on Bonds Payable
B. June 30, 2019 Interest Expense
Cash
C. June 30, 2019 Premium on Bonds Payable
Interest Expense
D. June 30, 2020 Interest Expense
Cash
E. June 30, 2020 Premium on Bonds Payable
Interest Expense](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F62233b5a-2fa9-4843-87d5-633f29657a22%2F98d07478-5225-42cd-b988-f13ed4eaf2dc%2Frbq4tga_processed.png&w=3840&q=75)
Transcribed Image Text:Volunteer Inc. issued bonds with a $650,000 face value, 12% interest rate, and a 4-year term on July 1, 2018 and received $700,000. Interest is payable annually. The premium is amortized using the straight-line method.
A. July 1, 2018: entry to record issuing the bonds
B. June 30, 2019: entry to record payment of interest to bondholders
C. June 30, 2019: entry to record amortization of premium
D. June 30, 2020: entry to record payment of interest to bondholders
E. June 30, 2020: entry to record amortization of premium
Prepare journal entries for the above transactions. If an amount box does not require an entry, leave it blank.
A. July 1, 2018
Cash
Bonds Payable
Premium on Bonds Payable
B. June 30, 2019 Interest Expense
Cash
C. June 30, 2019 Premium on Bonds Payable
Interest Expense
D. June 30, 2020 Interest Expense
Cash
E. June 30, 2020 Premium on Bonds Payable
Interest Expense
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