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Chrome File Edit View History Bookmarks People Window Help C Chegg Study Ouis xC Dobbs Company issxC Paulson Company Connect-XLS GPxE cGraw-Hill Educat x Chapter 0.8171578211885427 1523243712257 We Odwick Company ismes 10%, five year bonds, on December 31, 2015, with a par value of S95.000 and semiannua rierest payments. ?12012015 6302016 8,011 7.210 6,409 $103,011 102,210 101409 (2) 12/31/2016 Use the above straight-line bond amortization table and prepare journal entries for the following (c) The second interest payment on December 31, 2016. (a) The issuance of bonds on December 31, 2015 b) The first interest payment on June 30, 2016. Journal entry worksheet Record the interest payment on June 30, 2016 Note: Enter debits before credts Debit Credit Jun 30, 2016 on bonds 801 Cash 1,751 Clear entry 8

Explanation / Answer

Date

General Journal

Debit

Credit

12/31/2015

Cash

103011

Bonds payable

95000

Premium on bonds payable

8011

06/30/2016

Bond interest expense

5551

Premium on bonds payable

801

Cash

4750

12/31/2016

Bond interest expense

5551

Premium on bonds payable

801

Cash

4750

Explanation:

(b)

Premium on Bonds Payable = $8011 – $7210 = $801

Cash = $95000 × 10% × 1/2 = $4750
(c)

Premium on Bonds Payable = $7210 – $6409 = $801

Cash = $95000 × 10% × 1/2 = $4750

Date

General Journal

Debit

Credit

12/31/2015

Cash

103011

Bonds payable

95000

Premium on bonds payable

8011

06/30/2016

Bond interest expense

5551

Premium on bonds payable

801

Cash

4750

12/31/2016

Bond interest expense

5551

Premium on bonds payable

801

Cash

4750

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