QS 14-7 Recording bond issuance and discount amortization LO P1, P2
Sylvestor Company issues 10%, five-year bonds, on December 31, 2016, with a par value of $110,000 and semiannual interest payments.
Semiannual Period-End Unamortized Discount Carrying Value (0) 12/31/2016 $ 8,200 $ 101,800 (1) 6/30/2017 7,380 102,620 (2) 12/31/2017 6,560 103,440
Use the above bond amortization table and prepare journal entries to record
(a) the issuance of bonds on December 31, 2016
(b) the first interest payment on June 30, 2017
(c) the second interest payment on December 31, 2017.
QS 14-7 Recording bond issuance and discount amortization LO P1, P2
Sylvestor Company issues 10%, five-year bonds, on December 31, 2016, with a par value of $110,000 and semiannual interest payments.
| Semiannual Period-End | Unamortized Discount | Carrying Value | ||||||
| (0) | 12/31/2016 | $ | 8,200 | $ | 101,800 | |||
| (1) | 6/30/2017 | 7,380 | 102,620 | |||||
| (2) | 12/31/2017 | 6,560 | 103,440 | |||||
Use the above bond amortization table and prepare journal entries to record
(a) the issuance of bonds on December 31, 2016
(b) the first interest payment on June 30, 2017
(c) the second interest payment on December 31, 2017.
Related questions
Exercise 10-4 Straight-Line: Recording bond issuance and discount amortization LO P1, P2
Paulson Company issues 6%, four-year bonds, on December 31, 2017, with a par value of $90,000 and semiannual interest payments.
| Semiannual Period-End | Unamortized Discount | Carrying Value | ||||||
| (0) | 12/31/2017 | $ | 6,533 | $ | 83,467 | |||
| (1) | 6/30/2018 | 5,716 | 84,284 | |||||
| (2) | 12/31/2018 | 4,899 | 85,101 | |||||
Use the above straight-line bond amortization table and prepare journal entries for the following.
(a) The issuance of bonds on December 31, 2017.
(b) The first interest payment on June 30, 2018.
(c) The second interest payment on December 31, 2018.
Exercise 10-6 Straight-Line: Recording bond issuance and premium amortization LO P1, P3
Woodwick Company issues 7%, five-year bonds, on December 31, 2016, with a par value of $99,000 and semiannual interest payments.
| Semiannual Period-End | Unamortized Premium | Carrying Value | ||||||
| (0) | 12/31/2016 | $ | 8,091 | $ | 107,091 | |||
| (1) | 6/30/2017 | 7,282 | 106,282 | |||||
| (2) | 12/31/2017 | 6,473 | 105,473 | |||||
Use the above straight-line bond amortization table and prepare journal entries for the following.
(a) The issuance of bonds on December 31, 2016.
(b) The first interest payment on June 30, 2017.
(c) The second interest payment on December 31, 2017.
1/a. Record the issue of bonds with a par value of $99,000 cash on December 31, 2016.
2/b. Record the first interest payment on June 30, 2017.
3/c. Record the second interest payment on December 31, 2017.