Prepare the journal entry to record the issuance of the bonds on January 1, 2014
ID: 2497539 • Letter: P
Question
Prepare the journal entry to record the issuance of the bonds on January 1, 2014. (Round answers to 0 decimal places, e.g. 125. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Debit Credit Date Account Titles and Explanation Jan. 1 Cash 1,579,216 Discount on Bonds Payable 244784 Bonds Payable 1,824,000 SHOW LIST OF ACCOUNTS Prepare an amortization table through December 31, 2016 (three interest periods) for this bond issue. (Round answers to 0 decimal places, e.g. 125.) LOCK CORP Bond Discount Amortization Effective-Interest Method-Annual Interest Payments Annual Interest Periods Interest to Be Paid Interest Expense to Be Recorded Bond Carrying Value Discount Amortization Unamortized Discount Issue date 109440 109440 109440 126337Explanation / Answer
Bond Discount Amortization:
Journal Entries:
A B C D E F G Date Interest Payment Interest Expense Mkt 8% x Previous BV in G Amortization of Bond discount C - B Debit Balance in the account Bond Discount Credit Balance in the Account Bonds Payable Book Value of the Bonds F - E Jan 1, 2014 244784 1824000 1579216 Dec 31, 2014 109440 126337 16897 227887 1824000 1596113 Dec 31, 2015 109440 127689 18249 209638 1824000 1614362 Dec 31, 2016 109440 129149 19709 189929 1824000 1634071