Question

Sandhill Company issued $800,000, 12%, 10-year bonds on December 31, 2019, for $730,000. Interest is payable annually on December 31. Sandhill Company uses the straight-line method to amortize bond premium or discount. Your answer is correct. Prepare the journal entry to record the issuance of the bonds. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Debit Credit Date Account Titles and Explanation Dec. 31, 2019 Cash 730000 Discount on Bonds Payable 70000 Bonds Payable 800000

Answer 1

Credit Date General Journal Dec. 31, 2019 Cash Discount on bonds payable (800,000 - 730,000) Bonds payable Debit 730,000 70,000 800,000 Credit Date General Journal Dec. 31, 2019 Bonds payable Cash Debit 800,000 800,000