Question

Reed Hotel, Inc., completed the following selected transactions:
Year 1
Apr. 1 Issued $ 1,200,000 worth of 30-year, 9 percent bonds, dated April 1 of this year, at 103. Interest is payable semiannually on October 1 and April 1.
Oct. 1 Paid semiannual interest on the bonds.
Dec. 31 Recorded an adjusting entry for amortization of premium on bonds.
31 Recorded an adjusting entry for accrued interest payable.
31 Closed the Interest Expense account.
Year 2
Jan. 1 Reversed the adjusting entry for accrued interest payable.
Apr. 1 Paid semiannual interest on the bonds.
Oct. 1 Paid semiannual interest on the bonds.
Dec. 31 Made an adjusting entry to record amortization of premium on bonds.
31 Made an adjusting entry to record accrued interest payable.
31 Closed the Interest Expense account.

Required
1. Record the transactions in general journal form using pages 98 and 99 of the general journal.
2. Post entries to the Interest Expense account, No. 581. Label the adjusting, closing, and reversing entries.



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  • CreatedOctober 21, 2014
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