10.9

been made prior to December 31,20T5. d. Explain why the issuing corporation charged its bond investors for interest accrued in April 2015, prior to the issuance date (see part b above). 010-6 E 10.9 g for Bonds a Premium: Interest , and Xonic Corporation issued $8 million of 20-year, 8 percent bonds on April 1, 2015, at 102. Interest is due on March 31 and September 30 of each year, and all of the bonds in the issue mature on March 31, 2035. Xonic's fiscal year ends on December 31. Prepare the following journal entries: a. April 1, 2015, to record the issuance of the bonds. b. September 30, 2015, to pay interest and to amortize the bond premium. ement e. March 31, 2035, to pay interest, amortize the bond premium, and retire the bonds at maturity (make two separate entries). d. Briefly explain the effect of amortizing the bond premium on (1) annual net income and (2) annual net cash flow from operating activities. (Ignore possible income tax effects.) , LO10-6 ISE 10.10 ting for Bonds at a Discount: e, Interest Mellilo Corporation issued $5 million of 20-year, 9.5 percent bonds on July 1, 2015, at 98. Interest is due on June 30 and December 31 of each year, and all of the bonds in the issue mature on June 30, 2035. Mellilo's fiscal year ends on December 31. Prepare the following journal entries: a. July 1, 2015, to record the issuance of the bonds. b. December 31, 2015, to pay interest and amortize the bond discount e. ment June 30, 2035, to pay interest, amortize the bond discount, and retire the bonds at maturity (make two separate entries). Briefly explain the effect of amortizing the bond discount upon (1) annual net income and (2) annual net cash flow from operating activities. (Ignore possible income tax effects.) d. Shown below are data from recent reports of two toy makers. Dollar amounts are stated in thousands. RCISE 10.11 y of Creditors