On March 1, 2022, Cheryl Corp. issued a $800,000, 6 % two-year bond at a premium price of 103 when the market interest rate was 5% on the date of issue. Interest is payable semi-annually each September 1, and March 1. Using the straight-line interest method, prepare the journal entries to record the following events. a. Bond issuance on March 1, 2022: b. First interest payment on September 1, 2022: c. Second interest payment on: Date Debit Date Debit Debit d. Payoff of bond back to bond holders (please include date): Debit Credit Credit Credit Credit

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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On March 1, 2022, Cheryl Corp. issued a $800,000, 6% two-year bond at a premium
price of 103 when the market interest rate was 5% on the date of issue. Interest is
payable semi-annually each September 1, and March 1.
Using the straight-line interest method, prepare the journal entries to record the
following events.
a. Bond issuance on March 1, 2022:
b. First interest payment on September 1, 2022:
c. Second interest payment on:
Date
Debit
Date
Debit
Debit
d. Payoff of bond back to bond holders (please include date):
Debit
Credit
Credit
Credit
Credit
Transcribed Image Text:On March 1, 2022, Cheryl Corp. issued a $800,000, 6% two-year bond at a premium price of 103 when the market interest rate was 5% on the date of issue. Interest is payable semi-annually each September 1, and March 1. Using the straight-line interest method, prepare the journal entries to record the following events. a. Bond issuance on March 1, 2022: b. First interest payment on September 1, 2022: c. Second interest payment on: Date Debit Date Debit Debit d. Payoff of bond back to bond holders (please include date): Debit Credit Credit Credit Credit
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