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Moss Company issues bonds with a par value of $150,000 on July 1, 2016. The bonds’ annual contract rate is 8%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuance is 6%. Moss uses the effective interest method for amortizing premiums and discounts. What is the journal entry to record the bond issuance on July 1, 2016?

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Collen Von
Collen VonLv2
29 Sep 2019

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-Triumph Enterprises purchased equipment on January 1, 2016, for$200,000 in cash. The estimated useful life of the equipment is 10years and the estimated salvage value is $50,000. Triumph uses theDouble Declining Balance method to record depreciation. Record theDecember 31st adjusting journal entry for depreciation for2016.

Stanford issues bonds dated January 1, 2017, with a par value of$241,000. The bonds’ annual contract rate is 8%, and interest ispaid semiannually on June 30 and December 31. The bonds mature inthree years. The annual market rate at the date of issuance is 10%,and the bonds are sold for $228,764.

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