Question

Required information [The following information applies to the questions displayed below) On January 1, 2021 Twister Enterprises, a manufacturer of a variety of transportable spin rides, issues $560,000 of 7% bonds, due in 15 years, with interest payable semiannually on June 30 and December 31 each year. 2. If the market interest rate is 8%, the bonds will issue at $511.582. Record the bond issue on January 1, 2021, and the first two semiannual interest payments on June 30, 2021, and December 31, 2021. (If no entry is required for a particular transaction/event select "No Journal Entry Required in the first account field. Round your answers to the nearest dollar amount.) View transaction list Journal entry worksheet Record the bond issue. Note: Enter debts before Date General Journal Debit Credit January 01, 2021

Answer 1

Amortization Sechedule Interest | Change in the Cash Paid Expense Carrying value Date Carrying Value Jan-21 Jun-30 Dec-31 19600 19600 20463 20498 863 898 511582 512445 513343

Issue Entry 1. Record the Bond Issue Date General Journal Debit Credit Jan 1,2021 Cash 511582 Discount on Bonds Payable 48418 Bonds Payable 560000 Record the issue of the Bond with Discount Journal entris for interest Payment Record the interest payment and amotization on June 30 1st First Year Date General Journal Debit Credit July 30,2021 Interest Expenses 20463 Discount on Bonds Payable 863 Cash 19600 Record the interest Expense and amortization of Discount 3. Record theinterest and amotization on Dec 31, First Year Date General Journal Debit Credit Dec 31,2021 Interest Expenses 20498 Discount on Bonds Payable 898 Cash 19600 Record the interest Expense and amortization of Discount

Premium Amortized Date January 1 2021 June 30,2021 December 31,2021 Amortization Sechedule Interest Cash Paid Expense 0 0 19600 18446 19600 18412 Carrying Value 614881 613727 612539 1154 1188

Date January 1 2021 Issue Entry 1. Record the Bond Issue General Journal Debit Cash Premium on Bonds Payable Bonds Payable Record the issue of the Bond with Premium Credit 614881 54881 560000 19600 Record the interest Payment 2. Record the interest Paymnet and amotization Date General Journal Debit Credit June 30,2021 Interest Expenses 18446 Premium on Bonds Payable 1154 Cash Record the interest Paymnet and amotization 3. Record interest Paymnet and amotization Date General Journal Debit Credit Decmeber 31, 2021 Interest Expenses 18412 Premium on Bonds Payable 1188 Cash Record the interest Paymnet amotization 19600