Question

A company issued 8%, 15-year bonds with a par value of $550,000 that pay interest semi-annually. The current market rate is 8%. The journal entry to record each semiannual interest payment is:

Answer 1

The journal entry to record each semiannual interest payment is:

Debit Bond Interest Expense $22,000; credit Cash $22,000.

What journal entries?

• A journal entry is an act of keeping or producing records of any economic or non-economic transaction.
• An accounting journal, which shows a company's debit and credit balances, records transactions.
• The journal entry can be made up of multiple records, each of which is either a debit or a credit.
• Otherwise, the journal entry is termed unbalanced if the sum of the debits does not equal the total of the credits.
• For example, a corporation may issue 8%, 15-year bonds with a par value of $550,000 that pay semi-annual interest. The market rate is currently 8%.
• The journal entry for each semiannual interest payment is as follows: Debit Bond Interest Expense $22,000; credit Cash $22,000.

Therefore, the journal entry to record each semiannual interest payment is:

Debit Bond Interest Expense $22,000; credit Cash $22,000.

Know more about journal entries here:

brainly.com/question/14279491

#SPJ4