Question : 101) Darla’s Cookie Emporium borrowed money by issuing $200,000 of : 1230257

 

101) Darla’s Cookie Emporium borrowed money by issuing $200,000 of bonds at 96 on January 1. The bonds pay interest on January 1 and July 1. The stated rate of interest is 5% and the bonds mature in 10 years. Any discount or premium is amortized using the straight-line method. Journalize the entries to record the:

1.issuance of the bonds

2.interest paid on the bonds every six months.

3.payment of the bond at maturity.

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102) On January 1, Potter Company issued $600,000, 6%, 5-year bonds at face value. Interest is payable semiannually on July 1 and January 1. Journalize the entries to record:

1.the issuance of the bonds.

2.payment of interest on July 1.

3.accrual of interest on December 31.

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103) On January 1, 2012, Fisher Corporation issued 9%, 10-year bonds with a face value of $900,000 at 96. Interest is payable semiannually on January 1 and July 1. The effective-interest rate when the bonds were issued was 10%. Prepare the journal entries to record the issuance of the bonds and the first semiannual interest payment. Fisher Corporation uses the effective-interest method of amortization.

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104) On April 1, 2012, Edward Company issues $2,500,000 of 6%, 5-year bonds, with interest payments made each October 1 and April 1. The bonds are issued at 98. Edward Company amortizes any premium or discount using the straight-line method.

1.Prepare the journal entry on April 1 to issue the bonds.

2.Prepare the journal entry on October 1 to record the payment of interest and the amortization of any discount or premium.

3.Prepare the journal entry on December 31 to record accrued interest and the amortization of any discount or premium.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

105) On January 1, 2012, Henderson Company issued 8%, 20-year bonds with a face amount of $3,000,000 at 101. Interest is payable semiannually on June 30 and December 31. Prepare the journal entries to record the issuance of the bonds and the first semiannual interest payment. Henderson uses the straight-line method to amortize bond premium or discount.

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