The board of directors of Media Plus aut Requirements zes the issue of S6,000 00

Question

The board of directors of Media Plus aut Requirements zes the issue of S6,000 000 of 6%, 20-year bonds payable. The se annual nterest dates are May 31 and November 30. The bonds are issued on May 31, 2016, at face value. 1. Journalize the following transactions: a. Issuance of half of the bonds on May 31, 2016 b. Payment of interest on November 30, 2016 c. Accrual of interest on December 31, 2016 d. Payment of interest on May 31,2017 2. Report interest payable and bonds payable as they would appear on the Media Plus balance sheet at December 31, 2016.

Explanation / Answer

1). Journal Entries :-

2). Balance Sheet :-

Date Particulars Debit ($) Credit ($) May 31, 2016 Cash/ Bank A/c Dr. 3000000 To Bonds Payable A/c 3000000 Nov. 30, 2016 Interest on Bonds A/c Dr. 180000 To Cash/ Bank 180000 Dec. 31, 2016 Interest on Bonds A/c Dr. 30000 To Interest Payable 30000 May 31, 2017 Interest on Bonds A/c Dr. 150000 Interest Payable A/c Dr. 30000 To Cash/ Bank 180000

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