FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Transcribed Image Text:**Entries for Issuing Bonds**
Thomson Co. produces and distributes semiconductors for use by computer manufacturers. Thomson issued $240,000 of 15-year, 11% bonds on May 1 of the current year at face value, with interest payable on May 1 and November 1. The fiscal year of the company is the calendar year.
- **May 1:** Issued the bonds for cash at their face amount.
- **Nov. 1:** Paid the interest on the bonds.
- **Dec. 31:** Recorded accrued interest for two months.
**Journalize the entries to record the above selected transactions for the current year. If an amount box does not require an entry, leave it blank.**
| Date | Account Titles and Explanation | Debit | Credit |
|-----------|----------------------------------|-------|--------|
| May 1 | Bonds Payable | | |
| | Cash | | |
| | Discount on Bonds Payable | | |
| Dec. 31 | Interest Expense | | |
| | Interest Payable | | |
| | Premium on Bonds Payable | | |
The image also contains a box labeled “Check My Work” and buttons for navigating between pages (labeled "Previous").
**Note:** You need to fill in the appropriate debits and credits for the transactions, which reflect the financial activities associated with bond issuance and interest payments as per the journal entries required.
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