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19/47 On January 1, 2020, Sheffield Corporation issued $780,000, 5%, 5-year bonds dated January 1, 2017, at 96. The bonds pay annual interest on January

19/47

On January 1, 2020, Sheffield Corporation issued $780,000, 5%, 5-year bonds dated January 1, 2017, at 96. The bonds pay annual interest on January 1. The company uses the straight-line method of amortization and has a calendar year end. Prepare all the journal entries that Sheffield Corporation would make related to this bond issue through January 1, 2021. Be sure to indicate the date on which the entries would be made. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

Date

Account Titles and Explanation

Debit

Credit

January 1, 2020December 31, 2020January 1, 2021

enter an account title to record sale of bonds at a discount

enter a debit amount

enter a credit amount

enter an account title to record sale of bonds at a discount

enter a debit amount

enter a credit amount

enter an account title to record sale of bonds at a discount

enter a debit amount

enter a credit amount

(To record sale of bonds at a discount)

January 1, 2020December 31, 2020January 1, 2021

enter an account title to record annual accrued bond interest and amortization of bond discount

enter a debit amount

enter a credit amount

enter an account title to record annual accrued bond interest and amortization of bond discount

enter a debit amount

enter a credit amount

enter an account title to record annual accrued bond interest and amortization of bond discount

enter a debit amount

enter a credit amount

(To record annual accrued bond interest and amortization of bond discount)

January 1, 2020December 31, 2020January 1, 2021

enter an account title to record payment of bond interest liability

enter a debit amount

enter a credit amount

enter an account title to record payment of bond interest liability

enter a debit amount

enter a credit amount

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