Question
In: Accounting
On January 1, 2011, Davis Corporation issued $3,900,000 of 7% bonds at 101. Interest is paid...
On January 1, 2011, Davis Corporation issued $3,900,000 of 7% bonds at 101. Interest is paid annually on December 31 of each year. The bonds mature on December 31, 2027, and the company uses the straight-line method of amortization. On January 2, 2019, Davis reacquired the bonds and recognized a loss of $88,000.
1. Calculate the reacquisition price of the bonds on January 2, 2019. (102.7564103 is wrong)
2. Prepare the journal entry to record the reacquisition of Davis’s bonds on January 2, 2019. (I started some of it below)
| DATE | ACCOUNT TITLE | DEBIT | CREDIT | ||
|---|---|---|---|---|---|
|
1 |
Jan 2 |
Bonds Payable |
3,900,000 is correct |
||
|
2 |
Premium on Bonds Payable |
19500 is wrong |
|||
|
3 |
Loss on Bond Reacquisition |
88,000 is correct |
|||
|
4 |
Cash |
Solutions
ekkarill92 answered 2 years agoRelated Solutions
On January 1, 2008, Davis Corporation issued $3,000,000 of 8% bonds at 101. Interest is paid...
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bonds at 101. Interest is paid annually on December 31 of each
year. The bonds mature on December 31, 2027, and the company uses
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Prepare the journal entry to record the reacquisition of Davis’s
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Calculate the reacquisition price of the bonds on January 2,
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Gless’s no par common stock. Bonds that are similar in all
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Gless’s no par common stock. Bonds that are similar in all
respects, except that they are nonconvertible, currently are
selling at 99 (that is, 99% of face amount). Century Services
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Required:
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10-year convertible bonds at 101. The bonds pay interest on June 30
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Gless’s no par common stock. Bonds that are similar in all
respects, except that they are nonconvertible, currently are
selling at 99 (that is, 99% of face amount). Century Services
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Required:
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20-year convertible bonds at 101. The bonds pay interest on June 30
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Gless’s no par common stock. Bonds that are similar in all
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