Question

Brussels Enterprises issues bonds at par dated January 1, 2019, that have a $2,700,000 par value, mature in four years, and pay 6% interest semiannually on June 30 and December 31.

1. Record the entry for the issuance of bonds for cash on January 1.
2. Record the entry for the first semiannual interest payment and the second semiannual interest payment.
3. Record the entry for the maturity of the bonds on December 31, 2022 (assume semiannual interest is already recorded).

Answer 1

Bonds issued at Par. face value - 2700000 interest rate = 6% paid semi annually Debit credit January ist Cash (Bank Bonds payable $ 2700000 $ 2700000 June 30th $81000 Interest Expense Cash Bank 581000 December 31st $ 81000 Interest Expense Cash (Bank 4 81000 . December, 3187,2022 Bonds payable cash (Bank $ 2700006 $2700000