The Cleveland Historical Society issues $40 million of 6 percent, 15 year bonds at a price of $36,321,000 to nance the construction of a new museum The price reects an annual yield of 7 0 percent 1 Prepare the journal entry to record the issuance of the bonds Indicate the category of funds (e g , u...

1 Cash 36321000 Bond discount 3679000 Bonds payable 40000000 To record the issuan ...

The Cleveland Historical Society issues $40 million of 6 percent, 15-year bonds at a price of $36,321,000

Question:

The Cleveland Historical Society issues $40 million of 6 percent, 15-year bonds at a price of $36,321,000 to ﬁnance the construction of a new museum. The price reﬂects an annual yield of 7.0 percent.
1. Prepare the journal entry to record the issuance of the bonds. Indicate the category of funds (e.g., unrestricted, temporarily restricted, permanently restricted) in which the entry would be made.
2. Prepare the journal entry to record the ﬁrst semiannual payment of bond interest.
3. Prepare the journal entry to record the second semiannual payment of bond interest.