Walker Corporation issued 8%, five-year bonds with a par value of $5,500,000 on January 1, 2017. Interest is to be paid semiannually on each June 30 and December 31. The bonds were issued at $5,250,000 cash. (a) Prepare the general journal entry to record the issuance of the bonds on January 1, 2017. (b) Show how the bonds would be reported on Walker's balance sheet at January 1, 2017. (c) Assume instead that Walker uses the straight-line method for amortizing any discount or premium on bonds. Prepare the general journal entry to record the first semiannual interest payment on June 30, 2017. (d) Prepare the journal entry to retire the bonds on June 30, 2019 for $5,350,000
Related questions
ABCCorporation issued 14%, 5-year bonds with a par value of $5,000,000on January 1, 2015. Interest is to be paid semiannually on eachJune 30 and December 31. The bonds were issued at $5,368,035 cashwhen the market rate for this bond was 12%.
(a) Prepare the general journal entry to record the issuance of thebonds on January 1, 2015.
1/1/15 | |||
(b) Show how the bonds would bereported on ABC's balance sheet at January 1, 2015.
Long-Term liabilities: | ||
(c) Assume that ABC uses the effectiveinterest method for amortizing any discount or premium on bonds.Prepare the general journal entry to record the first semiannualinterest payment on June 30, 2015. SHOW YOUR CALCULATIONS!
6/30/15 | |||
(d) Assume instead that ABC uses the straight-line method foramortizing any discount or premium on bonds. Prepare the generaljournal entry to record the first semiannual interest payment onJune 30, 2015. SHOW YOUR CALCULATIONS!
6/30/15 | |||
(e) Assume that ABC uses the effective interest method foramortizing any discount or premium on bonds. Prepare the generaljournal entry to record the second semiannual interest payment onDecember 31, 2015. SHOW YOUR CALCULATIONS!
12/31/15 | |||
