Question

Blossom Company issued $261,000,7%, 15-year bonds on December 31, 2021, for $250,560. Interest is payable annually on December 31. Blossom uses the straight-line method to amortize bond premium or discount. Prepare the journal entries to record the following events. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) (a) The issuance of the bonds. (b) The payment of interest and the discount amortization on December 31, 2022. (c) The redemption of the bonds at maturity, assuming interest for the last interest period has been paid and recorded. No. Date Account Titles and Explanation Debit Credit (b) (c)

Answer 1

The answer has been presented in the supporting sheet. All the parts has been solved with detailed explanation and calculation. For detailed answer refer to the supporting sheet.

1 Answer 33 Account Title and Explanation 4 No. Credit Debit Date December 31,2021. Cash 5 a) 250560 Discount on Bond Payable 6 10440 Bond Payable 7 261000 December 31,2022. Interest expense 8 b) 18966 Discount on Bond Payable 9 696 Cash 10 18270 December 31,2036 Bond Payable 11 c) 261000 Cash 12 261000 13 14 15