Chapter 10 Homework Assignments On January 1, 2017, Boston Enterprises issues bo

Question

Chapter 10 Homework Assignments On January 1, 2017, Boston Enterprises issues bonds that have a $2,000,000 par value, mature in 20 semiannualy on June 30 and December 31. The bonds are sold at par years, nd pay 0% interest t. How much interest will Boston pay (in cash) to the bondholders every sic months? 2. Prepare journal entries to record (a) the issuance of the second interest payment on December 31, 2017 3. Prepare the journal entry for issuance assuming bonds on January 1, 2017, el the tst ieerest payment on An.a June 30, 2017; and (c) the bonds are issued at 96 and p) 104. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required Prepare the journal entry for issuance assuming the bonds are issued at (a) 96 and (b) 104. Journal entry worksheet Record the issue of bonds at 8s8 ,a 3 5

Explanation / Answer

1 Amount paid in cash = 2000000*10%/2= 100000 2 Jan-01 Cash 2000000      Bonds payable 2000000 Jun-30 Interest expense 100000        Cash 100000 Dec-31 Interest expense 100000        Cash 100000 3a Jan-01 Cash 1920000 Discount on Bonds payable 80000      Bonds payable 2000000 3b Jan-01 Cash 2080000      Premium on Bonds payable 80000      Bonds payable 2000000

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