$($d$)$ Prepare the journal entry for October $31,2023.$

Marking:

You have not included the 'Interest expense' account in this journal entry. This will cost you $2$ marks.

You have not included the 'Interest payable' account in this journal entry. This will cost you $2$ marks.

You have not included the 'Bonds payable' account in this journal entry. This will cost you $2$ marks.

'Cash' should be credited for the amount of $$21,250,$ but you have not done this. This will cost you $1$ mark.

Cash $=$$$850,0005\%\frac{6}{12}=$$$21,250$

'Bad debt expense' should not have been included in this journal entry. Any amounts entered for this account will not be evaluated.

You have not entered a description for this transaction. However you will not lose any marks for this.

$($e$)$ Prepare the journal entry for April $30,2024.$

Marking:

You have not included the 'Interest expense' account in this journal entry. This will cost you $2$ marks.

You have not included the 'Bonds payable' account in this journal entry. This will cost you $2$ marks.

'Cash' should be credited for the amount of $$21,250,$ but you have not done this. This will cost you $1$ mark.

'Advertising expense' should not have been included in this journal entry. Any amounts entered for this account will not be evaluated.

You have not entered a description for this transaction. However you will not lose any marks for this.

$($f$)$ Calculate the value of the bond on the June $30,2023$ balance sheet.

Bond value $=$$$1,010,101$

Marking:

Your answer was: $$1,010,101\mathrm{.}00$

The correct answer was: $$824,673\mathrm{.}18$

Bond value $=$ Previous balance $+$ Amortization $=$$$823,521\mathrm{.}30+$$$1,151\mathrm{.}88=$$$824,673\mathrm{.}18$

You will lose $2$ marks for this part.of issuance was $6\%.$ The company uses the effective method to measure interest expense.

$($a$)$ Calculate the issue proceeds at May $1,2023.$

Issue proceeds $=$$$12,000$

Marking:

Your answer was: $$12,000\mathrm{.}00$

The correct answer was: $$823,521\mathrm{.}30$

Number of interest periods $=1$ in $2023$ and two in $2024$ thru $2026,$ inclusive $=1+(23)=7$

Issue proceeds $=PV=(21,250PMT,3\frac{\text{I}}{Y},7N,850,000FV)=$$$823,521\mathrm{.}30$

You will lose $2$ marks for this part.

$($b$)$ Prepare the journal entry for May $1,2023.$

Marking:

'Cash' should be debited for the amount of $$823,521\mathrm{.}30,$ but you have not done this. This will cost you $1$ mark.

You have not included the 'Bonds payable' account in this journal entry. This will cost you $2$ marks.

'Depreciation expense, machinery' should not have been included in this joumal entry. Any amounts entered for this account will not be evaluated.

$($c$)$ Prepare the journal entry for June $30,2023($the fiscal year$-$end$).$

Marking:

You have not included the 'Interest expense' account in this journal entry. This will cost you $2$ marks.

You have not included the 'Bonds payable' account in this journal entry. This will cost you $2$ marks.

You have not included the 'Interest payable' account in this journal entry. This will cost you $2$ marks.

The following accounts should not have been included in this journal entry: Cash, Accumulated depreciation, equipment. Any amounts entered for these accounts will not be evaluated.

You have not entered a description for this transaction. However you will not lose any marks for this.

$($d$)$ Prepare the journal entry for October $31,2023.$