Presented below are selected transactions on the books of Simonson Corporation May 1, 2017 Bonds payable with a par value of $900,000, which are dated January 1, 2017, are sold at 106 plus accrued inter est They are coupon bonds, bear interest at 12 (payable annually at January 1), and mature Janua...

May 1 2017 Cash 900000 106 900000 12 412 99000000 Bonds Payable 90000000 Premium on Bonds Payable 54 ...

Presented below are selected transactions on the books of Simonson Corporation. May 1, 2017 Bonds payable with

Question:

Presented below are selected transactions on the books of Simonson Corporation.
May 1, 2017 Bonds payable with a of $900,000, which are dated January 1, 2017, are sold at 106 plus accrued inter-est. They are bonds, bear interest at 12% (payable annually at January 1), and mature January 1, 2027. (Use interest expense account for accrued interest.)
Dec. 31 Adjusting entries are made to record the accrued interest on the bonds, and the amortization of the proper amount of premium. (Use straight-line amortization.)
Jan. 1, 2018 Interest on the bonds is paid.
April 1 Bonds with of $360,000 are called at 102 plus accrued interest, and redeemed. (Bond premium is to be amortized only at the end of each year.)
Dec. 31 Adjusting entries are made to record the accrued interest on the bonds, and the proper amount of premium amortized.
Instructions
(Round to two decimal places.)
Prepare journal entries for the transactions above.
Coupon
A coupon or coupon payment is the annual interest rate paid on a bond, expressed as a percentage of the face value and paid from issue date until maturity. Coupons are usually referred to in terms of the coupon rate (the sum of coupons paid in a... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...