Question

Brief Exercise 14-4 The Stellar Company issued $250,000 of 11% bonds on January 1, 2017. The bonds are due January 1, 2022, with interest payable each July 1 and January 1. The bonds were issued at 101. Prepare the journal entries for (a) January 1, (b) July 1, and (c) December 31. Assume The Stellar Company records straight-line amortization semiannually. (If no entry is required, select "No Entry" for the account titles and enter o for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Round intermediate calculations to 6 decimal places, e.g. 1.251247 and final answer to o decimal places, e.g. 38,548.) No. Date Account Titles and Explanation Debit Credit (a) January 1, 2017 (b) July 1, 2017 (c) December 31, 2017

Answer 1

interest expenses $13500 and premium on bonds payable is $250 each on July 1st and Dec 31st

January Debit vedit cash Bank 2sasoo Bonds pay able $250000 Premium m Bonds Раyаble aSoo Tntarest 250000 Xl x (31SD July st 2014 Nrest Eptnse 130 Puramium n Rmds payable Couh Bant ) Dec; 31, 201t 1300 Trterest expense Paemieu Bands payabla Coum/Bank 3S0 Puramiu to be writen of over 500/gla so6 months