On January 1, 2020, Cullumber Industries Ltd. issued 1,780,000 face value, 5%, 10-year bonds at 1,648,990....

      

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On January 1, 2020, Cullumber Industries Ltd. issued £1,780,000 face value, 5%, 10-year bonds at £1,648,990. This price resulted in an effective-interest rate of 6% on the bonds. Cullumber uses the effective-interest method to amortize bond premium or discount. The bonds pay annual interest on January 1. Prepare the journal entry to record the issuance of the bonds on January 1, 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date January 1, 2020 Account Titles and Explanation Debit Credit On January 1, 2020, Cullumber Industries Ltd. issued £1,780,000 face value, 5%, 10-year bonds at £1,648,990. This price resulted in an effective-interest rate of 6% on the bonds. Cullumber uses the effective-interest method to amortize bond premium or discount. The bonds pay annual interest on January 1. Prepare the journal entry to record the issuance of the bonds on January 1, 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date January 1, 2020 Account Titles and Explanation Debit Credit Prepare an amortization table through December 31, 2022 (three interest periods) for this bond issue. (Round answers to O decimal places, e.g. 15,250.) £ (A) Interest to Be Paid LOCK INDUSTRIES LTD. Bond Discount Amortization Effective-Interest Method-Annual Interest Payments 5% Bonds Issued at 6% £ (B) Interest Expense to Be Recorded £ (C) Discount Amortization (B) - (A) £ (D) Bond Carrying Value 101 11 Prepare the journal entry to record the accrual of interest and the amortization of the discount on December 31, 2020. (Round answers to 0 decimal places, e.g. 15,250. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Dec. 31, 2020 Account Titles and Explanation Debit Credit Prepare the journal entry to record the payment of interest on January 1, 2021. (Round answers to O decimal places, e.g. 15,250. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Jan. 1, 2021 Account Titles and Explanation Debit Credit Prepare the journal entry to record the accrual of interest and the amortization of the discount on December 31, 2021. (Round answers to O decimal places, e.g. 15,250. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Dec. 31, 2021 Debit Credit On January 1, 2020, Cullumber Industries Ltd. issued £1,780,000 face value, 5%, 10-year bonds at £1,648,990. This price resulted in an effective-interest rate of 6% on the bonds. Cullumber uses the effective-interest method to amortize bond premium or discount. The bonds pay annual interest on January 1. Prepare the journal entry to record the issuance of the bonds on January 1, 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date January 1, 2020 Account Titles and Explanation Debit Credit On January 1, 2020, Cullumber Industries Ltd. issued £1,780,000 face value, 5%, 10-year bonds at £1,648,990. This price resulted in an effective-interest rate of 6% on the bonds. Cullumber uses the effective-interest method to amortize bond premium or discount. The bonds pay annual interest on January 1. Prepare the journal entry to record the issuance of the bonds on January 1, 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date January 1, 2020 Account Titles and Explanation Debit Credit Prepare an amortization table through December 31, 2022 (three interest periods) for this bond issue. (Round answers to O decimal places, e.g. 15,250.) £ (A) Interest to Be Paid LOCK INDUSTRIES LTD. Bond Discount Amortization Effective-Interest Method-Annual Interest Payments 5% Bonds Issued at 6% £ (B) Interest Expense to Be Recorded £ (C) Discount Amortization (B) - (A) £ (D) Bond Carrying Value 101 11 Prepare the journal entry to record the accrual of interest and the amortization of the discount on December 31, 2020. (Round answers to 0 decimal places, e.g. 15,250. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Dec. 31, 2020 Account Titles and Explanation Debit Credit Prepare the journal entry to record the payment of interest on January 1, 2021. (Round answers to O decimal places, e.g. 15,250. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Jan. 1, 2021 Account Titles and Explanation Debit Credit Prepare the journal entry to record the accrual of interest and the amortization of the discount on December 31, 2021. (Round answers to O decimal places, e.g. 15,250. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Dec. 31, 2021 Debit Credit On January 1, 2020, Cullumber Industries Ltd. issued £1,780,000 face value, 5%, 10-year bonds at £1,648,990. This price resulted in an effective-interest rate of 6% on the bonds. Cullumber uses the effective-interest method to amortize bond premium or discount. The bonds pay annual interest on January 1. Prepare the journal entry to record the issuance of the bonds on January 1, 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date January 1, 2020 Account Titles and Explanation Debit Credit On January 1, 2020, Cullumber Industries Ltd. issued £1,780,000 face value, 5%, 10-year bonds at £1,648,990. This price resulted in an effective-interest rate of 6% on the bonds. Cullumber uses the effective-interest method to amortize bond premium or discount. The bonds pay annual interest on January 1. Prepare the journal entry to record the issuance of the bonds on January 1, 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date January 1, 2020 Account Titles and Explanation Debit Credit Prepare an amortization table through December 31, 2022 (three interest periods) for this bond issue. (Round answers to O decimal places, e.g. 15,250.) £ (A) Interest to Be Paid LOCK INDUSTRIES LTD. Bond Discount Amortization Effective-Interest Method-Annual Interest Payments 5% Bonds Issued at 6% £ (B) Interest Expense to Be Recorded £ (C) Discount Amortization (B) - (A) £ (D) Bond Carrying Value 101 11 Prepare the journal entry to record the accrual of interest and the amortization of the discount on December 31, 2020. (Round answers to 0 decimal places, e.g. 15,250. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Dec. 31, 2020 Account Titles and Explanation Debit Credit Prepare the journal entry to record the payment of interest on January 1, 2021. (Round answers to O decimal places, e.g. 15,250. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Jan. 1, 2021 Account Titles and Explanation Debit Credit Prepare the journal entry to record the accrual of interest and the amortization of the discount on December 31, 2021. (Round answers to O decimal places, e.g. 15,250. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Dec. 31, 2021 Debit Credit On January 1, 2020, Cullumber Industries Ltd. issued £1,780,000 face value, 5%, 10-year bonds at £1,648,990. This price resulted in an effective-interest rate of 6% on the bonds. Cullumber uses the effective-interest method to amortize bond premium or discount. The bonds pay annual interest on January 1. Prepare the journal entry to record the issuance of the bonds on January 1, 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date January 1, 2020 Account Titles and Explanation Debit Credit On January 1, 2020, Cullumber Industries Ltd. issued £1,780,000 face value, 5%, 10-year bonds at £1,648,990. This price resulted in an effective-interest rate of 6% on the bonds. Cullumber uses the effective-interest method to amortize bond premium or discount. The bonds pay annual interest on January 1. Prepare the journal entry to record the issuance of the bonds on January 1, 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date January 1, 2020 Account Titles and Explanation Debit Credit Prepare an amortization table through December 31, 2022 (three interest periods) for this bond issue. (Round answers to O decimal places, e.g. 15,250.) £ (A) Interest to Be Paid LOCK INDUSTRIES LTD. Bond Discount Amortization Effective-Interest Method-Annual Interest Payments 5% Bonds Issued at 6% £ (B) Interest Expense to Be Recorded £ (C) Discount Amortization (B) - (A) £ (D) Bond Carrying Value 101 11 Prepare the journal entry to record the accrual of interest and the amortization of the discount on December 31, 2020. (Round answers to 0 decimal places, e.g. 15,250. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Dec. 31, 2020 Account Titles and Explanation Debit Credit Prepare the journal entry to record the payment of interest on January 1, 2021. (Round answers to O decimal places, e.g. 15,250. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Jan. 1, 2021 Account Titles and Explanation Debit Credit Prepare the journal entry to record the accrual of interest and the amortization of the discount on December 31, 2021. (Round answers to O decimal places, e.g. 15,250. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Dec. 31, 2021 Debit Credit

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