Question

On January 1, 2021, Twister Enterprises, a manufacturer of a variety of transportable spin rides, issues $590,000 of 8% bonds, due in 15 years, with interest payable semiannually on June 30 and December 31 each year. 2. If the market interest rate is 9%, the bonds will issue at $541,948. 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 first semiannual interest payment. Note: Enter debits before credits. Credit Date June 30, 2021 General Journal Interest Expense Discount on Bonds Payable Cash Debit 24,388 48,052 23,600

Can anyone help me? I can't figure this out or the next problem. Please show work :)

Answer 1

Twister enterprises - Part 1
Bond Amortisation schedule
						Date	Account Title	Debit ( $)	Credit ($)
Date	A.Cash paid ( 590000 * 4%)	B.Intt. Exp.( carrying value * 4.5%)	C. Bond Discount (b - a)	D.Carrying value ( d + c)		Jan. 1, 21	Cash	541948
Jan. 1, 21				541948			Discount on Bonds Payable	48052
June 30,21	23600	24388	788	542736			Bonds Payable		590000
Dec. 31, 21	23600	24423	823	543559			( To record the issuance of bonds )
						June 30,21	Interest Expense	24388
							Discount on Bonds Payable		788
							Cash		23600
							( To record first interest payment )
						Dec. 31, 21	Interest Expense	24423
							Discount on Bonds Payable		823
							Cash		23600
							( To record second interest payment )