On April 1, 2014, Seminole Company sold 26,100 of its 10%,14-year, $1,000 face value bonds at 96. Interest payment dates areApril 1 and October 1, and the company uses the straight-linemethod of bond discount amortization. On March 1, 2015, Seminoletook advantage of favorable prices of its stock to extinguish 7,700of the bonds by issuing 254,100 shares of its $10 par value commonstock. At this time, the accrued interest was paid in cash. Thecompanyâs stock was selling for $32 per share on March 1, 2015.Prepare the journal entries needed on the books of Seminole Companyto record the following.
(a) April 1, 2014: issuance ofthe bonds. (b) October 1, 2014: payment of semiannual interest. (c)December 31, 2014: accrual of interest expense. (d) March 1, 2015:extinguishment of 7,700 bonds. (No reversing entriesmade.)
On April 1, 2014, Seminole Company sold 26,100 of its 10%,14-year, $1,000 face value bonds at 96. Interest payment dates areApril 1 and October 1, and the company uses the straight-linemethod of bond discount amortization. On March 1, 2015, Seminoletook advantage of favorable prices of its stock to extinguish 7,700of the bonds by issuing 254,100 shares of its $10 par value commonstock. At this time, the accrued interest was paid in cash. Thecompanyâs stock was selling for $32 per share on March 1, 2015.Prepare the journal entries needed on the books of Seminole Companyto record the following.
(a) April 1, 2014: issuance ofthe bonds. (b) October 1, 2014: payment of semiannual interest. (c)December 31, 2014: accrual of interest expense. (d) March 1, 2015:extinguishment of 7,700 bonds. (No reversing entriesmade.)
Related questions
On April 1, 2014, Seminole Company sold 15,120 of its 11%,15-year, $1,000 face value bonds at 97. Interest payment dates areApril 1 and October 1, and the company uses the straight-linemethod of bond discount amortization. On March 1, 2015, Seminoletook advantage of favorable prices of its stock to extinguish 6,600of the bonds by issuing 217,800 shares of its $10 par value commonstock. At this time, the accrued interest was paid in cash. Thecompanyâs stock was selling for $32 per share on March 1,2015.
Prepare the journal entries needed on the books of Seminole Companyto record the following.
| (a) | April 1, 2014: issuance of the bonds. | |
| (b) | October 1, 2014: payment of semiannual interest. | |
| (c) | December 31, 2014: accrual of interest expense. | |
| (d) | March 1, 2015: extinguishment of 6,600 bonds. (No reversingentries made.) |
