On January 1, 2016, Hackman Corporation issued $1,400,000 face value 12% bonds dated January 1, 2016,...
On January 1, 2016, Hackman Corporation issued $1,400,000 face value 12% bonds dated January 1, 2016, for $1,423,060. The bonds pay interest semiannually on June 30 and December 31 and are due December 31, 2020. Hackman uses the straight-line amortization method.
Required:
| Record the issuance of the bonds and the first two interest payments. |
Homework Answers
|
date |
explanation |
debit |
credit |
|
1-Jan |
cash |
1423060 |
|
|
bonds payable |
1400000 |
||
|
premium on bonds payable |
23060 |
||
|
30-Jun |
interest expense |
81694 |
|
|
premium on bonds payable |
2306 |
||
|
cash |
84000 |
||
|
31-Dec |
interest expense |
81694 |
|
|
premium on bonds payable |
2306 |
||
|
cash |
84000 |
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