Answered: (a) Prepare the journal entry to record…

Business

Accounting

(a) Prepare the journal entry to record the issuance of the bonds on January 1, 2024.

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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Question

Current Attempt-in Progress
Swifty Co. is building a new hockey arena at a cost of $2,360,000. It received a downpayment of $510,000 from local businesses to
support the project, and now needs to borrow $1,850,000 to complete the project. It therefore decides to issue
$1,850,000 of 11.0%, 10-year bonds. These bonds were issued on January 1, 2024, and pay interest annually on each January 1. The
bonds yield 10%.
Click here to view factor table.
(a)
Prepare the journal entry to record the issuance of the bonds on January 1, 2024. (Round present value factor calculations to 5
decimal places, e.g. 1.25124 and the final answer to 0 decimal places, e.g. 58,971. 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 the amount is entered. Do not indent manually.
List all debit entries before credit entries.)
Date
January 1,
2024
Account Titles and Explanation
Debit
Credit

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