On January 31, 2021, B Corp. issued $700,000 face value, 12% bonds for $700,000 cash. The...
On January 31, 2021, B Corp. issued $700,000 face value, 12%
bonds for $700,000 cash. The bonds are dated December 31, 2020, and
mature on December 31, 2030. Interest will be paid semiannually on
June 30 and December 31.
What amount of accrued interest payable should B report in its
September 30, 2021, balance sheet?
Multiple Choice
-
$21,000.
-
$42,000.
-
$63,000.
-
$56,000.
Homework Answers
Correct answer--------$21,000
Interest for 3 months will be accrued on bonds as a liability for interest payable. The interest will be for the period July 01 till September 31.
Interest accrued =(700,000 x 12%)/12 x 3= $ 21,000
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