On the first day of the fiscal year, a company issues a $2,000,000, 9%, 5-year bond...

On the first day of the fiscal year, a company issues a $2,000,000, 9%, 5-year bond that pays semiannual interest of $90,000 ($2,000,000 × 9% × ½), receiving cash of $1,922,782.

Journalize the first interest payment and the amortization of the related bond discount. Round to the nearest dollar. If an amount box does not require an entry, leave it blank.

Expert Solution


Journal entries

Event	Dr/Cr	Particulars	Debit $	Credit $
Issue of bond at the beginning of the year	Debit	Cash/Bank	1,922,782
	Debit	Discount on issue of bond	77,218
	Credit	Bond Payable		2,000,000
		(To record the issue of bond at discount)

First interest payment	Debit	Interest expenses	90,000
	Credit	Cash/Bank		90,000
		(To record the payment of semi annual interest at the rate of9%)

Amortization of discount of issue of bonds at first semi annual interest payment date	Debit	Interest expenses	7,721.80
	Credit	Discount on issue of bond		7,721.80
		(To record the discount on issue of bonds in the profit and loss account)
		(77,218/10 semi annual interest)

ekkarill92 answered 1 year ago

On the first day of the fiscal year, a company issues a $3,200,000, 9%, 10-year bond...

On the first day of the fiscal year, a company issues a $3,200,000, 9%, 10-year bond that pays semiannual interest of $144,000 ($3,200,000 × 9% × ½), receiving cash of $2,649,441. Journalize the first interest payment and the amortization of the related bond discount. Round to the nearest dollar. If an amount box does not require an entry, leave it blank.

On the first day of the fiscal year, a company issues a $1,000,000, 10%, 5-year bond...

On the first day of the fiscal year, a company issues a $1,000,000, 10%, 5-year bond that pays semiannual interest of $50,000 ($1,000,000 × 10% × ½), receiving cash of $1,081,109. Journalize the bond issuance. If an amount box does not require an entry, leave it blank.

On the first day of the fiscal year, a company issues a $338,000, 7%, 10-year bond...

On the first day of the fiscal year, a company issues a $338,000, 7%, 10-year bond that pays semiannual interest of $11,830 ($338,000 x 7% x 1/2), receiving cash of $354,900. Journalize the entry to record the first interest payment and amortization of premium using the straight-line method. If an amount box does not require an entry, leave it blank. Interest Expense _____ _____ Premium on Bonds Payable ______ ______ Cash_____ ______

On the first day of the fiscal year, a company issues a $8,400,000, 12%, 10-year bond...

On the first day of the fiscal year, a company issues a $8,400,000, 12%, 10-year bond that pays semiannual interest of $504,000 ($8,400,000 × 12% × ½), receiving cash of $7,115,493. Journalize the first interest payment and the amortization of the related bond discount. Round to the nearest dollar. If an amount box does not require an entry, leave it blank.

Discount Amortization On the first day of the fiscal year, a company issues a $1,400,000, 8%,...

Discount Amortization On the first day of the fiscal year, a company issues a $1,400,000, 8%, 4-year bond that pays semiannual interest of $56,000 ($1,400,000 × 8% × ½), receiving cash of $1,266,974. Journalize the first interest payment and the amortization of the related bond discount. Round to the nearest dollar. If an amount box does not require an entry, leave it blank.

Calculato 2. On the first day of the fiscal year, a company issues a $952,000, 6%,...

Calculato 2. On the first day of the fiscal year, a company issues a $952,000, 6%, 10-year bond that pays semiannual interest of $28,560 ($952,000 × 6% × 1/2), receiving cash of $999,600. Required: Journalize the entry to record the first interest payment and amortization of premium using the straight-line method. Refer to the Chart of Accounts for exact wording of account titles. Journalize the entry to record the first interest payment and amortization of premium using the straight-line method...

Discount Amortization On the first day of the fiscal year, a company issues a $3,000,000, 11%,...

Discount Amortization On the first day of the fiscal year, a company issues a $3,000,000, 11%, five-year bond that pays semiannual interest of $165,000 ($3,000,000 × 11% × ½), receiving cash of $2,889,599. Journalize the first interest payment and the amortization of the related bond discount. Round to the nearest dollar. If an amount box does not require an entry, leave it blank. Interest Expense Discount on Bonds Payable Cash

Premium Amortization On the first day of the fiscal year, a company issues an $3,800,000, 12%,...

Premium Amortization On the first day of the fiscal year, a company issues an $3,800,000, 12%, 5-year bond that pays semiannual interest of $228,000 ($3,800,000 × 12% × ½), receiving cash of $4,093,425. Journalize the first interest payment and the amortization of the related bond premium. Round to the nearest dollar. If an amount box does not require an entry, leave it blank. Interest Expense Premium on Bonds Payable Cash Redemption of Bonds Payable A $930,000 bond issue on which...

On January 1, the first day of the fiscal year, a company issues a $1,350,000, 11%,...

On January 1, the first day of the fiscal year, a company issues a $1,350,000, 11%, five-year bond that pays semiannual interest of $74,250 ($1,350,000 x 11% x ½), receiving cash of $1,512,610. Journalize the bond issuance. Refer to the Chart of Accounts for exact wording of account titles. CHART OF ACCOUNTS- General Ledger ASSETS- 110 Cash, 111 Petty Cash, 121 Accounts Receivable, 122 Allowance for Doubtful Accounts, 126 Interest Receivable, 127 Notes Receivable, 131 Merchandise Inventory, 141 Office Supplies,...

On the first day of its fiscal year, Ebert Company issued $17,000,000 of 5-year, 10% bonds...

On the first day of its fiscal year, Ebert Company issued $17,000,000 of 5-year, 10% bonds to finance its operations. Interest is payable semiannually. The bonds were issued at a market (effective) interest rate of 11%, resulting in Ebert Company receiving cash of $16,359,296. The company uses the interest method. a. Journalize the entries to record the following: 1. Sale of the bonds. Round amounts to the nearest dollar. For a compound transaction, if an amount box does not require...

Question