Accounting: Tools for Business Decision Making, 5th Edition

Published by Wiley
ISBN 10: 1118128168
ISBN 13: 978-1-11812-816-9

Chapter 10 - Reporting and Analyzing Liabilities - Exercises: E10-19

Answer

Step1: 2009 Dec.31 Cash 290,000 dollars Discount on bonds payable 10,000 dollars Bonds Payable 300,000 dollars Step2: a)2010 Dec. 31 Bonds Interest Expenses 25,000 dollars Bonds Interest payable 24,000 dollars Discount on bonds payable 1,000 dollars b)Dec. 31 Bonds interest payable 24,000 dollars Cash 24,000 dollars Step3: 2020 Dec. 31 Bonds Payable 300,000 dollars Cash 300,000 dollars

Work Step by Step

Step1: To record issue of bonds at a discount Step2: a)To record accrued bond interest and Amortization of bond discount b)To record payment of bonds interest Step3: To record redemption of bonds on maturity
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