Canyon Company issued $600,000, 10-year, 6% bonds at 103. Instructions (a) Prepare the journal entry to record

Question:

Canyon Company issued $600,000, 10-year, 6% bonds at 103.

Instructions

(a) Prepare the journal entry to record the sale of these bonds on January 1, 2014.

(b) Suppose the remaining Premium on Bonds Payable was $10,800 on December 31, 2017. Show the balance sheet presentation on this date.

(c) Explain why the bonds sold at a price above the face amount.

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