On May 1 of Year 1, Setup Inc. sold an issue of 5%, $1,800 bonds dated...

 

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On May 1 of Year 1, Setup Inc. sold an issue of 5%, $1,800 bonds dated January 1 of Year 1 to yield 5%. The bonds pay interest every June 30 and December 31 and mature December 31 of Year 5. a. Provide journal entries to be made by Setup Inc. at each of the following dates. 1. May 1 of Year 1, bond issuance. 2. June 30 of Year 1, first interest payment. b. Indicate the amount of interest expense to be recorded in the company's income statement for the six months ended June 30 of Year 1. Note: Round your answer to the nearest whole dollar. Date a. May 1 Account Name To record the issuance of bonds. June 30 To record the first interest payment. > > > > > > Dr. Cr. 0 0 0 0 0 0 0 0 0 OOO 0 0 0 On May 1 of Year 1, Setup Inc. sold an issue of 5%, $1,800 bonds dated January 1 of Year 1 to yield 5%. The bonds pay interest every June 30 and December 31 and mature December 31 of Year 5. a. Provide journal entries to be made by Setup Inc. at each of the following dates. 1. May 1 of Year 1, bond issuance. 2. June 30 of Year 1, first interest payment. b. Indicate the amount of interest expense to be recorded in the company's income statement for the six months ended June 30 of Year 1. Note: Round your answer to the nearest whole dollar. Date a. May 1 Account Name To record the issuance of bonds. June 30 To record the first interest payment. > > > > > > Dr. Cr. 0 0 0 0 0 0 0 0 0 OOO 0 0 0

Answer rating: 100% (QA)

Answer a Journal entries for Setup Inc at each of the following dates 1 May 1 of Ye... View the full answer