Question

Question 1 (6 points) On April 1, 2016, Alpha Company issued $500,000 of 12%, 10-year bonds. The bonds, which were issued at 103, pay interest on October 1 and April 1. Use this information to prepare the General Journal entry (without explanation) to record the April 1, 2016 bond issue. If no entry is required then write "No Entry Required." D DC - Format V BI U - Question 2 (6 points) Saved On June 1, 2016 Alpha Corporation issued $300,000 of 9%, 5-year bonds. The bonds which were issued at 97, pay interest on January 1 and June 1. Use this information to prepare the General Journal entry (without explanation to record the June 1, 2016 bond issue. If no entry is required then write "No Entry Required." Duo - Format B U -

Answer 1

Answer Question 1 Credit Debit $515,000 Date Account Titles and Explanation April, 1 2016 Cash ($500,000 x 103%) Bonds Payable Premium on Bonds Payable [(500,000 x 103%) - 500,000) (To record the issue of bonds at 103) $500,000 $15,000 Question 2 Credit Date June, 1 2016 Account Titles and Explanation Cash ($300,000 x 97%) Discount on Bonds Payable ($300,000 - $291,000) Bonds Payable (To record the issue of bonds at 97) Debit $291,000 $9,000 $300,000