Issuing Bonds at a Face Amount On January 1, the first day of the fiscal year,...

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Issuing Bonds at a Face Amount

On January 1, the first day of the fiscal year, a company issues a $200,000, 6%, 10-year bond that pays semiannual interest of $6,000 ($200,000 × 6% × ½ year), receiving cash of $200,000.

(a) Journalize the entry to record the issuance of the bonds.

(b) Journalize the entry to record the first interest payment on June 30.

(c) Journalize the entry to record the payment of the principal on the maturity date.

business accounting

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Answer 1

Answer #1

a
Cash	200000
Bonds payable		200000

b
Interest expense	6000
Cash		6000

c
Bonds payable	200000
Cash		200000

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Answer 2

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