1. July 1, 2019, Leeward Corporation issued $2,000,000 face value bonds with a contractual interest rate...

1. July 1, 2019, Leeward Corporation issued $2,000,000 face value bonds with a contractual

interest rate of 6% and 20-year term. Prepare the following journal entries:

Issuance of the bonds at 104

Issuance of the bonds at 100

Issuance of the bonds at 95

Date	Account	Debit	Credit
July 1, 2019	Cash	2,080,000
	Bonds Payable		2,000,000
	Premium on Bonds Payable		80,000
July 1, 2019	Cash	2,000,000
	Bonds Payable		2,000,000
July 1, 2019	Cash	1,900,000
	Discount on Bonds Payable	100,000
	Bonds Payable		2,000,000

2. ANSWER THIS: Refer to Problem #1 – Assuming the bonds were issued at face value and interest is paid

annual on July 1, prepare the following journal entries:

Interest accrual on bonds at 12/31/2019

Payment of interest on 7/1/2020

Early retirement (payoff) of bonds at 98 on 7/2/2020

Solutions

Expert Solution

ekkarill92 answered 2 years ago

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