Question

A The following section is taken from Blossom's balance sheet at December 31, 2021.

Answer 1

Answer:

Date    Account titles and explanation          Debit       Credit

1-1-21    Bond interest payable                       $46,000

                  Cash                                                               $46,000

            (To record payment of interest)

1-1-21    Bond payable                                    $155,000

            Loss on redemption bond                $15,500

            (155,000/100*10)

                    Cash                                                              $170,500

            (To record bond redemption)

31-1-21   Interest expenses                              $36,450

                    Bond interest expenses                               $36,450

                    (560,000-155,000)*9%

             (Adjusting entry to accrue the interest on the remaining)