Sage Hill Inc. issued $852,000 of 20-year, 10% bonds on January 1, 2020, at 103. Interest...

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Sage Hill Inc. issued $852,000 of 20-year, 10% bonds on January 1, 2020, at 103. Interest is payable semi-annually on July 1 and January 1. The company follows ASPE and uses the straight-line method of amortization for any bond premium or discount. (a) Prepare the journal entries to record the following: (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) 1. The issuance of the bonds 2. The payment of interest and the related amortization on July 1, 2020 3. The accrual of interest and the related amortization on December 31, 2020 Date Account Titles and Explanation Debit Credit 1/1/20 Cash Bonds Payable 7/1/20 Interest Expense Bonds Payable Cash Date Account Titles and Explanation Debit Credit 1/1/20 Cash Bonds Payable 7/1/20 Interest Expense Bonds Payable Eash 12/31/20 Interest Expense Bonds Payable Interest Payable Sage Hill Inc. issued $852,000 of 20-year, 10% bonds on January 1, 2020, at 103. Interest is payable semi-annually on July 1 and January 1. The company follows ASPE and uses the straight-line method of amortization for any bond premium or discount. (a) Prepare the journal entries to record the following: (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) 1. The issuance of the bonds 2. The payment of interest and the related amortization on July 1, 2020 3. The accrual of interest and the related amortization on December 31, 2020 Date Account Titles and Explanation Debit Credit 1/1/20 Cash Bonds Payable 7/1/20 Interest Expense Bonds Payable Cash Date Account Titles and Explanation Debit Credit 1/1/20 Cash Bonds Payable 7/1/20 Interest Expense Bonds Payable Eash 12/31/20 Interest Expense Bonds Payable Interest Payable

Answer rating: 100% (QA)

Journal Entries Date Account titles and explanation D... View the full answer