Accounting for Bonds Payable On January 1, 2015, Crabb & Co. issued 10-year bonds with a total face value of $500,000. The bond requires annual interest payments on December 31 at a stated rate of 6%. Bonds with similar features are discounted in the market at 8%

.1. DATE ACCOUNT NAME DEBIT CREDIT BALANCE SHEET INCOME STMT A = L + E R - E 01/01/15

DATE

ACCOUNT NAME

DEBIT

CREDIT

BALANCE SHEET

INCOME STMT

A

=

L

+

E

R

-

E

01/01/15

2.Prepare the entry at 12/31/15 to record interest expense, cash paid, and discount amortization. DATE ACCOUNT NAME DEBIT CREDIT BALANCE SHEET INCOME STMT A = L + E R - E 12/31/15

DATE

ACCOUNT NAME

DEBIT

CREDIT

BALANCE SHEET

INCOME STMT

A

=

L

+

E

R

-

E

12/31/15