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timama [110]
3 years ago
6

Capital Company issued $600,000, 10%, 20-year bonds on January 1, 2020, at 103. Interest is payable annually January 1. Capital

uses the straight-line method of amortization and has a calendar year end.
Required:
Prepare all journal entries made in 2017 related to the bond issue.
Business
1 answer:
emmainna [20.7K]3 years ago
6 0

Answer:

Explanation:

Preparation of all journal entries made in 2017 related to the bond issue.)

Jan.1

Dr Cash $618,000

Cr Bonds Payable $618,000

Cr Premium on Bonds Payable. $8,000D

c.3 Interest Expense $59,100

Dr Premium on Bonds Payable $900

($18,000 *$20)

Cr Interest Payable $60,000

($600,000 × 10% = $60,000)

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