On January 1, Year 1, Price Co. issued $219,000 of five-year, 8 percent bonds at 96. Interest is payable annually on December 31. The discount is amortized using the straight-line method. Required Prepare the journal entries to record the bond transactions for Year 1 and Year 2.

On January 1, Year 1, Price Co. issued $219,000 of five-year, 8 percent bonds at 96. Interest is payable annually on December 31. The discount is amortized using the straight-line method. Required Prepare the journal entries to record the bond transactions for Year 1 and Year 2.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 6PB: Edward Inc. issued bonds with a $500,000 face value, 10% interest rate, and a 4-year term on July 1,...

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Question

On January 1, Year 1, Price Co. issued $219,000 of five-year, 8 percent bonds at 96. Interest is payable annually on December 31. The discount is amortized using the straight-line method.

Required
Prepare the journal entries to record the bond transactions for Year 1 and Year 2.

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