Carlyle Corporation had the following bond transactions during the fiscal year 2017: On January 1: issued...

Carlyle Corporation had the following bond transactions during the fiscal year 2017:

On January 1: issued ten $10,000 bonds at 101. The 5-year bonds are dated January 1, 2017. The contract interest rate is 5%. Straight-line amortization method is used. Interest is payable semi-annual on January 1 and July 1.

On July 1: Carlyle Corporation issued $500,000 of 10%, 10-year bonds. The bonds dated January 1, 2017 were issued at 88, and pay interest on July 1 and January 1. Effective interest rate for these bonds is 10%. Straight-line amortization method is used.

On October 1: issued 10-year bonds $10,000 face value bonds, for $10,985 cash. The bonds have a stated rate of 7%. Straight-line amortization method is used. Interest is payable on October 1 and April 1. general journal entries for the three bonds issued and any interest accruals and payments for the fiscal year 2017. (Round all calculations to nearest whole dollar.)

Expert Solution

Journal entries:
Date	Accounts title and explanations	Debit $	Credit $
1-Jan	Cash account Dr.	10100
	Bonds payable		10000
	Premium on Bonds payable		100

1-Jul	Interest expense Dr.	240
	Premium on Bonds payable Dr. (100/10)	10
	Cash account (100005%6/12)		250

1-Jul	Cash account Dr. (500000*88%)	440000
	Discount on bonds payable Dr.	60000
	Bonds payable		500000

1-Oct	Cash account Dr.	10985
	Bonds payable		10000
	Premium n bonds payable		985

31-Dec	Interest expense Dr.	240
	Premium on Bonds payable Dr. (100/10)	10
	Interest payable		250

31-Dec	Interest expenses Dr.	28000
	Interest payable (50000010%6/12)		25000
	Discount on bonds payable (60000/20)		3000

31-Dec	Interest expenses	150.375
	Premium on bonds payable Dr. (985/20*1/2)	24.625
	Interest payable (100007%3/12)		175

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