Dixon Construction, Inc., issued $300,000 of 10-year, 6 percent bonds on July 1, 2016, at 96. Interest
Question:
Dixon Construction, Inc., issued $300,000 of 10-year, 6 percent bonds on July 1, 2016, at 96.
Interest is payable in cash semiannually on June 30 and December 31. Dixon uses the straight- line method of amortization.
Required
a. Prepare the journal entries to record issuing the bonds and any necessary journal entries for 2016 and 2017. Prepare any necessary closing entries for 2016. Post the entries to T-accounts.
b. Prepare the liabilities section of the balance sheet at the end of 2016 and 2017.
c. What amount of interest expense will Dixon Construction report on the financial statements for 2016 and 2017?
d. What amount of cash will Dixon Construction pay for interest in 2016 and 2017?
Financial StatementsFinancial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
Step by Step Answer:
a Dixon Construction Inc General Journal Date Account Titles Debit Credit 2016 July 1 Cash 1 288000 ...View the full answer
Fundamental Financial Accounting Concepts
ISBN: 978-0078025907
9th edition
Authors: Thomas Edmonds, Christopher Edmonds
