On the first day of the fiscal year, a company issues a $1,000,000, 8%, five-year bond...

 

 

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On the first day of the fiscal year, a company issues a $1,000,000, 8%, five-year bond that pays semiannual interest of $40,000 ($1,000,000 x 8% x %), receiving cash of $951,590. Journalize the bond issuance on January 1. Refer to the Chart of Accounts for exact wording of account titlies. CHART OF ACCOUNTS General Ledger ASSETS REVENUE 110 Cash 410 Sales 111 Petty Cash 610 Interest Revenue 121 Accounts Receivable 611 Gain on Redemption of Bonds 122 Allowance for Doubtful Accounts 126 Interest Receivable EXPENSES 127 Notes Receivable 510 Cost of Merchandise Sold 131 Merchandise Inventory 515 Credit Card Expense 141 Office Supplies 516 Cash Short and Over 191 Land 522 Office Salaries Expense 194 Office Equipment 531 Advertising Expense 195 Accumulated Depreciation-Office Equipment 532 Delivery Expense 533 Repairs Expense LIABILITIES 535 Rent Expense 210 Accounts Payable 536 Insurance Expense 221 Salaries Payable 537 Office Supplies Expense 231 Sales Tax Payable 541 Bad Debt Expense 232 Interest Payable 562 Depreciation Expense-Office Equipment 241 Notes Payable 590 Miscellaneous Expense 251 Bonds Payable 710 Interest Expense 252 Discount on Bonds Payable 711 Loss on Redemption of Bonds 253 Premium on Bonds Payable EQUITY 311 Common Stock 312 Paid-In Capital in Excess of Par-Common Stock 315 Treasury Stock 321 Preferred Stock 322 Paid-In Capital in Excess of Par-Preferred Stock 331 Paid-In Capital from Sale of Treasury Stock 340 Retained Eamings 351 Cash Dividends 352 Stock Dividends 390 Income Summary Journal Journalize the bond issuance on January 1. Refer to the Chart of Accounts for exact wording of account titles. PAGE 10 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 On the first day of the fiscal year, a company issues a $1,000,000, 8%, five-year bond that pays semiannual interest of $40,000 ($1,000,000 x 8% x %), receiving cash of $951,590. Journalize the bond issuance on January 1. Refer to the Chart of Accounts for exact wording of account titlies. CHART OF ACCOUNTS General Ledger ASSETS REVENUE 110 Cash 410 Sales 111 Petty Cash 610 Interest Revenue 121 Accounts Receivable 611 Gain on Redemption of Bonds 122 Allowance for Doubtful Accounts 126 Interest Receivable EXPENSES 127 Notes Receivable 510 Cost of Merchandise Sold 131 Merchandise Inventory 515 Credit Card Expense 141 Office Supplies 516 Cash Short and Over 191 Land 522 Office Salaries Expense 194 Office Equipment 531 Advertising Expense 195 Accumulated Depreciation-Office Equipment 532 Delivery Expense 533 Repairs Expense LIABILITIES 535 Rent Expense 210 Accounts Payable 536 Insurance Expense 221 Salaries Payable 537 Office Supplies Expense 231 Sales Tax Payable 541 Bad Debt Expense 232 Interest Payable 562 Depreciation Expense-Office Equipment 241 Notes Payable 590 Miscellaneous Expense 251 Bonds Payable 710 Interest Expense 252 Discount on Bonds Payable 711 Loss on Redemption of Bonds 253 Premium on Bonds Payable EQUITY 311 Common Stock 312 Paid-In Capital in Excess of Par-Common Stock 315 Treasury Stock 321 Preferred Stock 322 Paid-In Capital in Excess of Par-Preferred Stock 331 Paid-In Capital from Sale of Treasury Stock 340 Retained Eamings 351 Cash Dividends 352 Stock Dividends 390 Income Summary Journal Journalize the bond issuance on January 1. Refer to the Chart of Accounts for exact wording of account titles. PAGE 10 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2

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Answer The Journal entry to record the issuance of the ... View the full answer