Yale Corporation issued $60,000, 8% (cash interest payable semiannually on June 30 and December 31) 10-year bonds dated and sold on January 1. Yale amortizes any bond discount or premium using the effective interest amortization method and bond issuance costs are $1,500. If the bonds were sold to yield 9%, provide journal entries to be made at each of the following dates. a. January 1, for issuance of bonds. b. June 30, for the first interest payment. • Note: Round your answers to the nearest whole dollar. Date a. Jan. 1 Account Name Cash Premium on Bonds Payable Bonds Payable To record bond issuance. b. June 30 Interest Expense Cash Premium on Bonds Payable To record interest payment. # # + # ♦ Dr. 54,598 5,402 0 2,457 0 0 Cr. 0✔ 0x 60,000✔ 0x 2,400✔ 57 x

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Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Yale Corporation issued $60,000, 8% (cash interest payable semiannually on June 30 and December 31) 10-year bonds dated and sold on January 1. Yale amortizes any
bond discount or premium using the effective interest amortization method and bond issuance costs are $1,500. If the bonds were sold to yield 9%, provide journal
entries to be made at each of the following dates.
a. January 1, for issuance of bonds.
b. June 30, for the first interest payment.
• Note: Round your answers to the nearest whole dollar.
Date
a. Jan. 1
Account Name
Cash
Premium on Bonds Payable
Bonds Payable
To record bond issuance.
b. June 30 Interest Expense
Cash
Premium on Bonds Payable
To record interest payment.
+
✪
◆
#
+
+
Dr.
54,598
5,402
0
2,457
0
0
Cr.
0
0x
60,000✔
0x
2,400✔
57 x
Transcribed Image Text:Yale Corporation issued $60,000, 8% (cash interest payable semiannually on June 30 and December 31) 10-year bonds dated and sold on January 1. Yale amortizes any bond discount or premium using the effective interest amortization method and bond issuance costs are $1,500. If the bonds were sold to yield 9%, provide journal entries to be made at each of the following dates. a. January 1, for issuance of bonds. b. June 30, for the first interest payment. • Note: Round your answers to the nearest whole dollar. Date a. Jan. 1 Account Name Cash Premium on Bonds Payable Bonds Payable To record bond issuance. b. June 30 Interest Expense Cash Premium on Bonds Payable To record interest payment. + ✪ ◆ # + + Dr. 54,598 5,402 0 2,457 0 0 Cr. 0 0x 60,000✔ 0x 2,400✔ 57 x
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