Outstanding Accountants Co. sells $1,000,000 of 10-year, 4% bonds priced to yield 3.9%. The bonds are dated
Question:
Outstanding Accountants Co. sells $1,000,000 of 10-year, 4% bonds priced to yield 3.9%. The bonds are dated and issued on January 1, 2018. Interest is payable on January 1 and July 1 each year. Outstanding’s year-end is June 30.
Required:
Prepare journal entries to record:
a. The issuance of the bonds.
b. Accrual of interest and related amortization on June 30, 2018.
c. Payment of interest on July 1, 2018.
d. Payment of interest and related amortization on January 1, 2019.
Step by Step Answer:
a The issuance of the bonds Debit Cash 1000000 Credit Bonds Payable 1000000 ...View the full answer
Related Video
A journal entry is an act of keeping or making records of any transactions either economic or non-economic. Transactions are listed in an accounting journal that shows a company\'s debit and credit balances. The journal entry can consist of several recordings, each of which is either a debit or a credit
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