Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations. Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations. Discount on bonds payable: It occurs when the bonds are issued at a low price than the face value. Premium on bonds payable: It occurs when the bonds are issued at a high price than the face value. 1. To prepare: Journal entry to record issuance of bonds payable at face value.
Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations. Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations. Discount on bonds payable: It occurs when the bonds are issued at a low price than the face value. Premium on bonds payable: It occurs when the bonds are issued at a high price than the face value. 1. To prepare: Journal entry to record issuance of bonds payable at face value.
Definition Definition Method of recording financial transactions in the book of original entry by debiting and crediting the accounts affected by a transaction using the golden rules of accrual accounting.
Chapter 12, Problem 12.24E
1.
To determine
Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money from investors to raise fund for financing the operations.
Bonds Payable: Bonds payable are referred to long-term debts of the business, issued to various lenders known as bondholders, generally in multiples of $1,000 per bond, to raise fund for financing the operations.
Discount on bonds payable: It occurs when the bonds are issued at a low price than the face value.
Premium on bonds payable: It occurs when the bonds are issued at a high price than the face value.
1.
To prepare:Journal entry to record issuance of bonds payable at face value.
2.
To determine
To prepare: Journal entry to record issuance of bonds payable at discount.
3.
To determine
To prepare: Journal entry to record issuance of bonds payable at premium.
4.
To determine
To explain: The bond price which results the most interest expense.