Lombard Company issued $400,000 of 8%, 10-year bonds on January 1, 2017, at face value. Interest is
Question:
Lombard Company issued $400,000 of 8%, 10-year bonds on January 1, 2017, at face value. Interest is payable annually on January 1, 2018.
Instructions
Prepare the journal entries to record the following events:
(a) The issuance of the bonds.
(b) The accrual of interest on December 31, 2017.
(c) The payment of interest on January 1, 2018.
(d) Assuming Lombard has a September 30 year end, prepare the adjusting journal entry needed on September 30, 2017, and prepare the journal entry to record the interest payment on January 1, 2018, assuming reversing entries have not been used.
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Step by Step Answer:
a 2017 Jan 1 Cash 400000 Bonds Payable 400000 b 2017 Dec 31 ...View the full answer
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ISBN: 978-1119048473
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Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel, Barbara Trenholm, Valerie Warren, Lori Novak
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