Question

Exercise 10-17 Sandhill Co. issued $310,000 of 8%, 20-year bonds on January 1, 2022, at face value. Interest is payable annually on January 1.

Prepare the journal entry to record the issuance of the bonds. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Jan. 1, 2022 enter an account title to record the issuance of the bonds on January 1, 2017 enter a debit amount enter a credit amount enter an account title to record the issuance of the bonds on January 1, 2017 enter a debit amount enter a credit amount

Prepare the journal entry to record the accrual of interest on December 31, 2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date	Account Titles and Explanation	Debit	Credit
Dec. 31, 2022	enter an account title to record the accrual of interest on December 31, 2017	enter a debit amount	enter a credit amount
	enter an account title to record the accrual of interest on December 31, 2017	enter a debit amount	enter a credit amount

Prepare the journal entry to record the payment of interest on January 1, 2023. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date	Account Titles and Explanation	Debit	Credit
Jan. 1, 2023	enter an account title to record the payment of interest on January 1, 2018	enter a debit amount	enter a credit amount
	enter an account title to record the payment of interest on January 1, 2018	enter a debit amount	enter a credit amount

Prepare the journal entry to record the redemption of the bonds at maturity, assuming interest for the last interest period has been paid and recorded. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date	Account Titles and Explanation	Debit	Credit
Jan. 1, 2042	enter an account title to record the redemption of the bonds at maturity on January 1	enter a debit amount	enter a credit amount
	enter an account title to record the redemption of the bonds at maturity on January 1	enter a debit amount	enter a credit amount

Answer 1

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Solution: Naming convention of account title can be slightly different per question format: Credit Date Jan.01 2022 Debit 310000 310000 24800 Dec.31 2022 24800 Journal Entries Account title and explaination Cash Bonds payable (To record the issuance of bonds) Interest Expense (310000*8%) Interest Payable (To record the Accrual of interest) Interest Payable Cash (To record the interest payment) Bonds payable Cash (To record the redemption of bonds) 24800 Jan.01 2023 24800 310000 Jan.01 2042 310000