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✔Your answer is correct. epare the journal entry to record the issuance of the bonds on January 1, 2027. (Credit account titles are automatically inc en the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for mounts.)

✔Your answer is correct. epare the journal entry to record the issuance of the bonds on January 1, 2027. (Credit account titles are automatically inc en the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for mounts.)

FINANCIAL ACCOUNTING
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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On January 1, 2027, Sunland Corporation issued $3,520,000 face value, 10%, 10-year bonds at $3,312,699. This price resulted in an effective interest rate of 11% on the bonds. Sunland uses the effective-interest method to amortize bond premium or discount. The bonds pay interest each January 1. (a) Your answer is correct. Prepare the journal entry to record the issuance of the bonds on January 1, 2027. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Jan. 1 Cash Discount on Bonds Payable Bonds Payable Debit 3312699 207301 Credit 3520000
Transcribed Image Text:On January 1, 2027, Sunland Corporation issued $3,520,000 face value, 10%, 10-year bonds at $3,312,699. This price resulted in an effective interest rate of 11% on the bonds. Sunland uses the effective-interest method to amortize bond premium or discount. The bonds pay interest each January 1. (a) Your answer is correct. Prepare the journal entry to record the issuance of the bonds on January 1, 2027. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Jan. 1 Cash Discount on Bonds Payable Bonds Payable Debit 3312699 207301 Credit 3520000
(b) (b) Prepare an amortization table through December 31, 2029 (three interest periods) for this bond issue. (Round answers to 0 decimal places, e.g. 15,250.) Annual Interest Periods Issue date S Interest to Be Paid Interest Expense to Be Recorded SUNLAND CORPORATION Bond Discount Amortization Effective-Interest Method-Annual Interest Payments Prepare an amortization table through December 31, 2029 (three interest periods) for this bond issue. (Round answers to 0 decimal places, eg. 15,250) SUNLAND CORPORATION Bond Discount Amortization Effective-Interest Method-Annual Interest Payments Discount Amortization Interest Expense to Be Recorded 110 Discount Amortization Unamortized Discount Bond Carrying Value Unamor Disco
Transcribed Image Text:(b) (b) Prepare an amortization table through December 31, 2029 (three interest periods) for this bond issue. (Round answers to 0 decimal places, e.g. 15,250.) Annual Interest Periods Issue date S Interest to Be Paid Interest Expense to Be Recorded SUNLAND CORPORATION Bond Discount Amortization Effective-Interest Method-Annual Interest Payments Prepare an amortization table through December 31, 2029 (three interest periods) for this bond issue. (Round answers to 0 decimal places, eg. 15,250) SUNLAND CORPORATION Bond Discount Amortization Effective-Interest Method-Annual Interest Payments Discount Amortization Interest Expense to Be Recorded 110 Discount Amortization Unamortized Discount Bond Carrying Value Unamor Disco
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