Yale Corporation issued to Zap Corporation $60,000, 8% (cash interest payable semiannually on June 30 and December31) 10-year bonds dated and sold on January 1. Assume that the company uses the effective interest amortizationmethod and bond issuance costs are $1,500. If the bonds were sold to yield 9%, provide journal entries to be made ateach of the following dates.a. January 1, for issuance of bonds.b. June 30, for the first interest payment.• Note: Round your answer to the nearest whole dollar.Datea. Jan. 1Account NameCashDiscount on Bonds PayableBonds PayableTo record bond issuance.b. June 30 Interest ExpenseDiscount on Bonds PayableCashTo record interest payment.<<> >Dr.54,59700000Cr.0x2,374 *60,0000x0x0x

Bond is a fixed interest bearing security which is issued by the company to raise finance for the…

Answered: Yale Corporation issued to Zap…

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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Recording Bonds Issued at Face Value Yale Corporation issued to Zap Corporation $36,000, 8% (cash interest payable semiannually on July 1 and January 1) 10-year bonds dated and sold on January 1, 2020. If the bonds were sold at face value, provide the journal entries to be made at each of the following dates. Yale's fiscal year ends on December 31. a. January 1, 2020, for issuance of bonds. b. July 1, 2020, Cash c. December 3 Inventory Equipment Date Dr. Cr. Land a. Jan. 1, 2020 Deferred Revenue Bonds Payable Discount on Bonds Payable b. Jul. 1, 2020 Discount and Debt Issuance Costs Premium on Bonds Payable Fair Value Adjustment-Bonds Payable Note Payable Discount on Note Payable с. Dec. 31, 202 Premium on Note Payable Fair Value Adjustment-Note Payable Interest Payable Please answer Common Stock Paid-in Capital in Excess of Par-Common Stock Paid-in Capital-Stock Warrants Retained Earnings-Prior Period Adjustment Debt Conversion Expense Previous Next Interest Expense Loss on Redemption…
Subject :- Account
On January 1, $853,000, 5-year, 10% bonds were issued for $827,410. Interest is paid semiannually on January 1 and July 1. If the issuing corporation uses the straight-line method to amortize a discount on bonds payable, the semiannual amortization amount is a. $42,650 O Ob. $2,559 Oc. $25,590 Od. $5,118
On January 1, the first day of the fiscal year, a company issues an $2,250,000, 12%, five-year bond that pays semiannual interest of $135,000 ($2,250,000 x 12% x ½), receiving cash of $2,379,360. Required: Journalize the first interest payment and the amortization of the related bond premium. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered.
On January 1, the first day of the fiscal year, a company issues a $700,000, 7%, 10-year bond that pays semiannua interest of $24,500 ($700,000 x 7% x V2 year), receiving cash of $700,000. (a) Journalize the entry to record the issuance of the bonds. Cash 700,000 Bonds Payable - (b) Journalize the entry to record the first interest payment on June 30. Interest Expense Cash
Issuing Bonds at a Premium On the first day of the fiscal year, a company issues a $8,700,000, 7%, 10-year bond that pays semiannual interest of $304,500 ($8,700,000 × 7% × ½), receiving cash of $10,833,863. Journalize the bond issuance. If an amount box does not require an entry, leave it blank.
Subject : Accounting
On April 1, Year 1, Brandi Corporation issued $20,000,000 of 5-year, 9% bondsat a market interest rate of 8%, receiving cash of $20,811;010. Interest ispayable semiannually on April 1 and October 1. Journalize the entries to recordthe following:a. Issuance of the bonds on April 1, Year 1b. First interest payment on October 1, Year 1, and the amortization of bond premium for 2 months, using the straight-line method. how would I do part b since october 1 is 6 months away from april 1 but it says amortization of the bond premium for 2 months?
Accounting Entries for Bonds Payable and Installment Note Transactions The following transactions were completed by Winklevoss Inc., whose fiscal year is the calendar year: Year 1 July 1. Issued $1,300,000 of five-year, 9% callable bonds dated July 1, Year 1, at a market (effective) rate of 11%, receiving cash of $1,202,010. Interest is payable semiannually on December 31 and June 30. Oct. 1. Borrowed $380,000 by issuing a 10-year, 8% installment note to Nicks Bank. The note requires annual payments of $57,631, with the first payment occurring on September 30, Year 2. Dec. 31. Accrued $7,600 of interest on the installment note. The interest is payable on the date of the next installment note payment. 31. Paid the semiannual interest on the bonds. The bond discount amortization of $9,799 is combined with the semiannual interest payment. Year 2 June 30. Paid the semiannual interest on the bonds. The bond discount amortization of $9,799 is combined with the semiannual interest payment.…
Bonds Payable Journal Entries; Straight-Line Interest Amortization On December 31, Brown Company issued $400,000 of 20-year, eight percent bonds payable for $331,364, yielding an effective interest rate of ten percent. Interest is payable semiannually on June 30 and December 31. Prepare journal entries to reflect (a) the issuance of the bonds, (b) the semiannual interest payment and discount amortization (straight-line interest method) on June 30, and (c) the semiannual interest payment and discount amortization on December 31. Round answers to the nearest dollar. General Journal Date Description Debit Credit (a) 12/31/Y1 Cash Answer Answer Answer Answer Answer Answer Answer Answer To record issuance of bonds at a discount. (b) 06/30/Y2 Answer Answer Answer Answer Answer Answer Cash Answer Answer To record semiannual payment and discount amortization. (c) 12/31/Y2 Answer Answer Answer Answer Answer Answer Cash…
Issuing Bonds at a Premium On the first day of the fiscal year, a company issues a $1,600,000, 6%, 6-year bond that pays semiannual interest of $48,000 ($1,600,000 × 6% × ½), receiving cash of $1,682,063. Journalize the bond issuance. If an amount box does not require an entry, leave it blank. 日

Bonds Payable Journal Entries; Issued at Par Plus Accrued InterestAskew, Inc., which closes its books on December 31, is authorized to issue $700,000 of nine percent, 15-year bonds dated May 1, with interest payments on November 1 and May 1.RequiredPrepare journal entries to record the following events, assuming that the bonds were sold at 100 plus accrued interest on October 1:a. The bond issuance.b. Payment of the first semiannual period's interest on November 1.c. Accrual of bond interest expense at December 31.d. Payment of the semiannual interest on May 1 of the following year.e. Retirement of $500,000 of the bonds at 101 on May 1, Year 2 (immediately after the interest payment on that date). Round to the nearest dollar. Use 360 days for calculations. General Journal Date Description Debit Credit a. Oct.1 AnswerCashBonds PayableBond Interest PayableBond Interest ExpenseLoss on Bond Retirement Answer 0 Bonds Payable 0 700000 AnswerCashBonds…

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