Question
In: Accounting
Cupola Fan Corporation issued 12%, $460,000, 10-year bonds for $450,000 on June 30, 2021. Debt issue...
Cupola Fan Corporation issued 12%, $460,000, 10-year bonds for
$450,000 on June 30, 2021. Debt issue costs were $2,100. Interest
is paid semiannually on December 31 and June 30. One year from the
issue date (July 1, 2022), the corporation exercised its call
privilege and retired the bonds for $455,000. The corporation uses
the straight-line method both to determine interest expense and to
amortize debt issue costs.
Required:
1. to 4. Prepare the journal entry to record the issuance
of the bonds, the payment of interest and amortization of debt
issue costs on December 31, 2021 & June 30, 2022, and the call
of the bonds.
Solutions
Expert Solution
The answer has been presented in the supporting sheet. All the parts has been solved with detailed explanation and calculation. For detailed answer refer to the supporting sheet.
note for entry no. 4 date will
be july 1, 2022
ekkarill92 answered 2 years agoRelated Solutions
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