r 10 Quiz Question 5 (of 5) M10-11 Recording Bonds Issued at Face Value [LO 10-3

Question

r 10 Quiz Question 5 (of 5) M10-11 Recording Bonds Issued at Face Value [LO 10-3] The following information applies to the questions displayed below] Schiliterbahn Waterslide Company issued 38,000, 10-year,6 percent, $100 bonds on January 1 at face value Interest is payable each December 31 (a) The issuance of these bonds on January 1 (b) The first interest payment on December 31 References M10-11 Recording Bonds Issued at Face Value [LO 10-3 Section Break 1.00 points M10-11 Part 2 Prepare the journal entries related for the above transactions. (If no entry is required for a transactionJevent select "No Journal Entry Required" in the first account field.) 2. SC F2 F3 F4 FI

Explanation / Answer

Issue of Bonus Shares = 38,000 Bonds @ $100 Per bond

Cash (Dr.) $3,800,000

Bond Payable (Cr.) $3,800,000

Interest Entry 38,000 Bonds @ $100 Per bond @ 6% = $3,800,000 *6%

Bond Interest Expense (Dr.) $228,000

To Cash (Cr.) $228,000

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