The board of directors of Epsilon Health Spa authorizes the issuance of ($450,000) of 8%, 10-year bonds
Question:
The board of directors of Epsilon Health Spa authorizes the issuance of \($450,000\) of 8%, 10-year bonds payable. The semiannual interest dates are May 31 and November 30. The bonds are issued on July 31, 2010, at par plus accrued interest.
Requirements
1. Journalize the following transactions:
a. Issuance of the bonds on July 31, 2010
b. Payment of interest on November 30, 2010
c. Accrual of interest on December 31, 2010
d. Payment of interest on May 31, 2011
2. Report interest payable and bonds payable as they would appear on the Epsilon balance sheet at December 31, 2010.
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Step by Step Answer:
Journal Entries for Epsilon Health Spa Bonds 1 Journal Transactions a Issuance of the bonds on July 31 2010 Since the bonds are issued at par value theres no premium or discount on bonds payable We ne...View the full answer
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Related Book For 
Financial And Managerial Accounting
ISBN: 9780135080191
2nd Edition
Authors: Charles T Horngren, Jr Walter T Harrison
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