Question

Print by: Erik Yeley 2019-SU-ACC2110-101: Financial Accounting / Chapter 10 Homework Assignment *Exercise 10-9 , 2019 , Monty Corp. issued $562,000, 15 % , 10-year bonds at face value. Interest is payable annually on January 1. On January (a) 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.) Date Account Titles and Explanation Debit Credit Jan. 1 (b) Prepare the journal entry record the accrual of interest on December 31, 2019. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit Date Dec. 31 (c) record the payment of interest Prepare the iournal entry n January 1, 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Debit Credit Date Account Titles and Explanation Jan. 1

Answer 1

(a)

Cash a/c Dr. 562000

To 15%Bond 562000

(Being 15% Bond Issued)

(b)

Interest on 15%Bond Dr 84300

To Bond Holders' a/c 84300

(Being interest on bond became due)

(c)

Bond holders'a/c Dr. 84300

To Cash/Bank 84300

(Being Interest on Bond paid to bond holders)

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