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Buffalo Co$.$ is building a new hockey arena at a cost of $$2,620,000.$ It received a downpayment of $$450,000$ from local businesses to support the project, and now needs to borrow $$2,170,000$ to complete the project. It therefore decides to issue $$2,170,000$ of $10\mathrm{.}0\%,10-$year bonds. These bonds were issued on January $1,2024,$ and pay interest annually on each January $1.$ The bonds yield $9\%.$

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$($a$)$

$$ Your Answer

$$ Correct Answer

Your answer is partially correct.

Prepare the journal entry to record the issuance of the bonds on January $1,2024.($Round present value factor calculations to $5$ decimal places, e$.$g$.1\mathrm{.}25124$ and the final answer to $0$ decimal places, e$.$g$.58,971.$ If no entry is required, select $"$No Entry" for the account titles and enter $0$ for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.$)$

Date Account Titles and Explanation Debit Credit

January $1,2024$ enter an account title for the journal entry on January $1,2024$Correct answer enter a debit amountIncorrect answer enter a credit amountIncorrect answer

enter an account title for the journal entry on January $1,2024$Correct answer enter a debit amountCorrect answer enter a credit amountCorrect answer

enter an account title for the journal entry on January $1,2024$Correct answer enter a debit amountIncorrect answer enter a credit amountIncorrect answer

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Solution

List of Accounts

Attempts: $5$ of $5$ used

$($b$)$

Prepare a bond amortization schedule up to and including January $1,2028,$ using the effective$-$interest method. $($Round present value factor to $5$ decimal places, e$.$g$.1\mathrm{.}24356$ and final answers to $0$ decimal places, e$.$g$.38,548.)$

Date

Cash

Paid

Interest

Expense

Premium

Amortization Carrying

Value of

Bonds

$1/1/24$ $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount

$1/1/25$ enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount

$1/1/26$ enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount

$1/1/27$ enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount

$1/1/28$ enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount

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List of Accounts

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Attempts: $0$ of $5$ used

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$($c$)$

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