Patton issues $680,000 of 6.5%, four-year bonds dated January 1,2011, that pay interest semiannually on June 30 and December 31.They are issued at $645,669 and their market rate is 8% at theissue date.
3. value:
10.00 points 1. Prepare the January 1, 2011, journal entry to record the bonds'issuance. (Omitthe "$" sign in your response.)
Date General Journal Debit Credit Jan. 1 (Click to select)Premium on bonds payableBond interestpayableAccounts payableDiscount on bonds payableBondspayableCashBond interest expenseAccounts receivable (Click to select)Accounts receivablePremium on bondspayableAccounts payableBond interest payableBond interestexpenseCashBonds payableDiscount on bonds payable (Click to select)Bondinterest payableAccounts receivableAccounts payablePremium on bondspayableBonds payableBond interest expenseDiscount on bondspayableCash
4. value:
10.00 points 2. Determine the total bond interest expense to be recognized over thebonds' life. (Omitthe "$" sign in your response.)
Total bond interest expense $
5. value:
10.00 points 3. Prepare a straight-line amortization table for the bonds' first two years.(Make sure that the unamortized discount is adjusted to "0" and thecarrying value equals to face value of the bond in the last period.Round your intermediate calculations and final answers to thenearest dollar amount. Omit the "$" sign in yourresponse.)
Semiannual
Interest Period-End Unamortized
Discount Carrying
Value 1/01/2011 $ $ 6/30/2011 12/31/2011 6/30/2012 12/31/2012
6. value:
10.00 points 4. Prepare the journal entries to record the first two interestpayments. (Roundyour intermediate calculations and final answers to the nearestdollar amount. Omit the "$" sign in your response.)
Date General Journal Debit Credit June 30 (Click to select)Discount on bonds payableBond interestexpensePremium on bonds payableAcconts payableCashBond interestpayableAccounts receivableBonds payable (Click to select)Premiumon bonds payableAccounts payableBonds payableCashAccountsreceivableDiscount on bonds payableBond interest expenseBondinterest payable (Click to select)BondspayableDiscount on bonds payableBond interest payableBond interestexpenseAccounts payablePremium on bonds payableCashAccountsreceivable Dec. 31 (Click to select)Bond interest expenseAccountspayableBond interest payablePremium on bonds payableCashAccountsreceivableBonds payableDiscount on bonds payable (Click to select)AccountspayableDiscount on bonds payableBonds payableBond interestexpenseBond interest payableAccounts receivablePremium on bondspayableCash (Click to select)AccountsreceivableBonds payableBond interest expenseCashDiscount on bondspayableBond interest payablePremium on bonds payableAccountspayable
Patton issues $680,000 of 6.5%, four-year bonds dated January 1,2011, that pay interest semiannually on June 30 and December 31.They are issued at $645,669 and their market rate is 8% at theissue date. |
10.00 points
1. | Prepare the January 1, 2011, journal entry to record the bonds'issuance. (Omitthe "$" sign in your response.) |
Date | General Journal | Debit | Credit |
Jan. 1 | (Click to select)Premium on bonds payableBond interestpayableAccounts payableDiscount on bonds payableBondspayableCashBond interest expenseAccounts receivable | ||
(Click to select)Accounts receivablePremium on bondspayableAccounts payableBond interest payableBond interestexpenseCashBonds payableDiscount on bonds payable | |||
(Click to select)Bondinterest payableAccounts receivableAccounts payablePremium on bondspayableBonds payableBond interest expenseDiscount on bondspayableCash | |||
10.00 points
2. | Determine the total bond interest expense to be recognized over thebonds' life. (Omitthe "$" sign in your response.) |
Total bond interest expense | $ |
10.00 points
3. | Prepare a straight-line amortization table for the bonds' first two years.(Make sure that the unamortized discount is adjusted to "0" and thecarrying value equals to face value of the bond in the last period.Round your intermediate calculations and final answers to thenearest dollar amount. Omit the "$" sign in yourresponse.) |
Semiannual Interest Period-End | Unamortized Discount | Carrying Value |
1/01/2011 | $ | $ |
6/30/2011 | ||
12/31/2011 | ||
6/30/2012 | ||
12/31/2012 | ||
10.00 points
4. | Prepare the journal entries to record the first two interestpayments. (Roundyour intermediate calculations and final answers to the nearestdollar amount. Omit the "$" sign in your response.) |
Date | General Journal | Debit | Credit |
June 30 | (Click to select)Discount on bonds payableBond interestexpensePremium on bonds payableAcconts payableCashBond interestpayableAccounts receivableBonds payable | ||
(Click to select)Premiumon bonds payableAccounts payableBonds payableCashAccountsreceivableDiscount on bonds payableBond interest expenseBondinterest payable | |||
(Click to select)BondspayableDiscount on bonds payableBond interest payableBond interestexpenseAccounts payablePremium on bonds payableCashAccountsreceivable | |||
Dec. 31 | (Click to select)Bond interest expenseAccountspayableBond interest payablePremium on bonds payableCashAccountsreceivableBonds payableDiscount on bonds payable | ||
(Click to select)AccountspayableDiscount on bonds payableBonds payableBond interestexpenseBond interest payableAccounts receivablePremium on bondspayableCash | |||
(Click to select)AccountsreceivableBonds payableBond interest expenseCashDiscount on bondspayableBond interest payablePremium on bonds payableAccountspayable | |||
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