A7 Carla Vista Company issued $790,000, 9%, 10-year bonds on December 31, 2021, for $720,000. Interest is payableannually on December 31. Carla Vista Company uses the straight-line method to amortize bond premium or discount.(a)Prepare the journal entry to record the issuance of the bonds. (Credit account titles are automatically indented whenamount is entered. Do not indent manually.)Date Account Titles and ExplanationDec.31,2021DebitCredit (c)Prepare the journal entry to record the redemption of the bonds at maturity, assuming interest for the last interestperiod has been paid and recorded. (Credit account titles are automatically indented when amount is entered. Do notindent manually.)Date Account Titles and ExplanationDec.31,2031eTextbook and MediaList of AccountsSave for LaterDebitAttempts: 0 of 1 usedCreditSubmit Answer

The discount on bonds payable can be amortized using the straight-line method. The discount on bonds…

Carla Vista Company issued $790,000, 9%, 10-year bonds on December 31, 2021, for $720,000. Interest is payable annually on December 31. Carla Vista Company uses the straight-line method to amortize bond premium or discount.

Carla Vista Company issued $790,000, 9%, 10-year bonds on December 31, 2021, for $720,000. Interest is payable annually on December 31. Carla Vista Company uses the straight-line method to amortize bond premium or discount.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 5PA: Volunteer Inc. issued bonds with a $500,000 face value, 10% interest rate, and a 4-year term on July...

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Question

Carla Vista Company issued $790,000, 9%, 10-year bonds on December 31, 2021, for $720,000. Interest is payable
annually on December 31. Carla Vista Company uses the straight-line method to amortize bond premium or discount.
(a)
Prepare the journal entry to record the issuance of the bonds. (Credit account titles are automatically indented when
amount is entered. Do not indent manually.)
Date Account Titles and Explanation
Dec.
31,
2021
Debit
Credit

(c)
Prepare the journal entry to record the redemption of the bonds at maturity, assuming interest for the last interest
period has been paid and recorded. (Credit account titles are automatically indented when amount is entered. Do not
indent manually.)
Date Account Titles and Explanation
Dec.
31,
2031
eTextbook and Media
List of Accounts
Save for Later
Debit
Attempts: 0 of 1 used
Credit
Submit Answer

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