M14-21 (Supplement 14C) Recording Bond Issuance and Interest Payment (Straight-L

Question

M14-21 (Supplement 14C) Recording Bond Issuance and Interest Payment (Straight-Line Amortization) Simko Company issued $641,000, 10-year, 7 percent bonds on January 1, 2009. The bonds were issued for $629,000. Interest is payable annually on January 1 Required Using straight-line amortization, prepare journal entries to record (a) the bond issuance on January 1, 2009 and (b) the payment of interest on January 1, 2010. (Omit the "s" sign in your response.) General Journal Credit (Click to select) (Click to select) (a) (Click to select) (b) (Click to select). (Click to select) Click to select) References

Explanation / Answer

Journal entry

accounts & explanation debit credit a) Cash a/c 629000 Discount on bonds payable a/c 12000       Bonds payable a/c 641000 (To record issuance of bonds payable) b) Interest expenses a/c 46070      Discount on bonds payable a/c (12000/10) 1200      Cash a/c (641000*7%) 44870 (To record interest paid)

Related Questions

Navigate

• Browse (All)
• Browse M
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.