Question: Presented below are two independent situations. 1. On January 1, 2014, Simon Company issued $200,000 of 9%, 10-year bonds at par. Interest is payable quarterly

Presented below are two independent situations.

1. On January 1, 2014, Simon Company issued $200,000 of 9%, 10-year bonds at par. Interest is payable quarterly on April 1, July 1, October 1, and January 1.
2. On June 1, 2014, Garfunkel Company issued $100,000 of 12%, 10-year bonds dated January 1 at par plus accrued interest. Interest is payable semiannually on July 1 and January 1.

Instructions
For each of these two independent situations, prepare journal entries to record the following.
(a) The issuance of the bonds.
(b) The payment of interest on July 1.
(c) The accrual of interest on December 31.

Step by Step Solution

★★★★★

3.43 Rating (159 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

a The issuance of bonds Debit Cash 200000 Credit Bonds Payable 200000 b Payment of interest on July ... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Intermediate Accounting Questions!

Prepare journal entries to record the following transactions for DesmondCorporation: Apr. June Dec. 15 30 31 Declared a $48,000 cash dividend payable to common shareholders Paid the dividend declared...

Prepare journal entries to record the following grant-related transactions of an enterprise fund activity. Explain how these transactions should be reported in the enterprise funds financial...

Prepare journal entries to record the following transactions in the appropriate funds of a nongovernmental not-for-profit university: 1. Tuition and fees assessed total $6,000,000. Eighty percent is...

(Entries for Bond Transactions) Presented below are two independent situations. 1. On January 1, 2017 Simon Company issued $200,000 of 9%, 10-year bonds at par. Interest is payable quarterly on April...

E14-3 (L01) (Entries for Bond Transactions) Presented below are two independent situations 1. On January 1, 2017, Simon Company issued $200,000 of 9%, 10-year bonds at par. Interest is payable...

Presented below are two independent situations. 1. On January 1, 2020, Nash Company issued $360,000 of 9%, 10-year bonds at par. Interest is payable quarterly on April 1, July 1, October 1, and...

Presented below are two independent situations. 1. On January 1, 2020, Larkspur Company issued $348,000 of 9%, 10-year bonds at par. Interest is payable quarterly on April 1, July 1, October 1, and...

Exercise 14-3 Presented below are two independent situations. 1. On January 1, 2017, Sandhill Company issued $396,000 of 9%, 10-year bonds at par. Interest is payable quarterly on April 1, July 1,...

Exercise 14-03 Presented below are two independent situations. 1. On January 1, 2020, Grouper Company issued $396,000 of 9%, 10-year bonds at par. Interest is payable quarterly on April 1, July 1,...

Exercise 14-3 Presented below are two independent situations. 1. On January 1, 2017, Kingbird Company issued $360,000 of 9%, 10-year bonds at par. Interest is payable quarterly on April 1, July 1,...

You are the Manager of a subsidiary of your company in Toronto, Canada Your company HQ is planning to shut down the subsidiary and lay off the workers. Deep down you know you can turn things around...

Based on data from six countries, the paper A Cross National Relationship Between Sugar Consumption and Major Depression?(Depression and Anxiety [2002]: 118 120) concluded that there was a...

An unmodified opinion audit report with an explanatory paragraph is

How effectively does the board address management succession?

At December 31, 2012, Appaloosa Corporation had a deferred tax liability of $25,000. At December 31, 2013, the deferred tax liability is $42,000. The corporations 2013 current tax expense is $48,000....

At December 31, 2012, Suffolk Corporation had an estimated warranty liability of $105,000 for accounting purposes and $0 for tax purposes. (The warranty costs are not deductible until paid.) The...

At December 31, 2012, Percheron Inc. had a deferred tax asset of $30,000. At December 31, 2013, the deferred tax asset is $59,000. The corporations 2013 current tax expense is $61,000. What amount...

Siegel Corporation manufactures a product available in both a deluxe and a regular model. The company has made the regular model for years, the deluxe model was introduced several years ago to...

hello guys, could you please help me with this? Thank you! Question 5 (a) Consider the following pair of bonds which are alike except for the characteristics listed. Bond A Bond B Coupon rate 4% 0%...

Market_State Probability CLS DCP JSE MARKET SHARE PROBABILITY CLS DCP JSE BRILLIANT 15% 30.02% 8.41% 19.22% GOOD 20% 29.53% 8.27% 18.9% NEUTRAL 40% 19.02% 5.33% 12.17% BAD 20% 16.87% 4.72% 10.79%...