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: E10-21

Answer

Step1: 2010 Jan. 1 Cash 483,120 dollars Bonds Payable 450,000 dollars Premium on bonds payable 33,120 dollars Step2: 2010 Dec. 31 Bonds Interest Expenses 28,987 dollars Premium on bonds payable 2,513 dollars Bonds Interest payable 31,500 dollars Step3: 2011 Jan. 01 Bonds interest payable 31,500 dollars Cash 31,500 dollars

Work Step by Step

Step1: To record issue of bonds at a premium Step2: To record accrued bond interest and Amortization of bond premium Step3: To record payment of bonds interest
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