On July 1, 2009, the Nicholsen Corporation issued $300,000 of bonds, with a 13% face rate of
Question:
On July 1, 2009, the Nicholsen Corporation issued $300,000 of bonds, with a 13% face rate of interest, for $318,000. The bonds pay interest semiannually on each January 1 and July 1 and are to be repaid in three equal semiannual installments beginning July 1, 2011. Assume the company’s fiscal year ends May 31 and it makes reversing entries for year-end accruals.
Required
Prepare the journal entries to account for this serial bond issue on each of the following dates, using the bonds outstanding method of amortization:
1. July 1, 2009
2. January 1, 2010
3. July 1, 2010
4. January 1, 2011
5. July 1, 2011
6. January 1, 2012
7. July 1, 2012
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
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Related Book For 
Intermediate Accounting
ISBN: 978-0324659139
11th edition
Authors: Loren A. Nikolai, John D. Bazley, Jefferson P. Jones
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