Bonds Issued at a Discount

Emerald, Inc. issued the following bonds at a discount:

Date of issue and sale:	April 1, 20-1
Principal amount:	$440,000
Sale price of bonds:	95
Denomination of bonds:	$1,000
Life of bonds:	20 years
Stated rate:	9%, payable semiannually on September 30 and March 31

Required:

1. Prepare journal entries for the activities listed below.

(a) Issuance of the bonds at a discount.

Page:

	DATE	ACCOUNT TITLE	DOC. NO.	POST. REF.	DEBIT	CREDIT
1	20-1 Apr. 1				fill in the blank c191bdf4cfdd06a_2	fill in the blank c191bdf4cfdd06a_3	1
2					fill in the blank c191bdf4cfdd06a_5	fill in the blank c191bdf4cfdd06a_6	2
3					fill in the blank c191bdf4cfdd06a_8	fill in the blank c191bdf4cfdd06a_9	3

(b) Interest payment and discount amortization on the bonds on September 30, 20-1.

Page:

	DATE	ACCOUNT TITLE	DOC. NO.	POST. REF.	DEBIT	CREDIT
1	20-1 Sept. 30				fill in the blank d76ac307afd2007_2	fill in the blank d76ac307afd2007_3	1
2					fill in the blank d76ac307afd2007_5	fill in the blank d76ac307afd2007_6	2
3					fill in the blank d76ac307afd2007_8	fill in the blank d76ac307afd2007_9	3

(c) Year-end adjustment on the bonds for 20-1.

Page:

	DATE	ACCOUNT TITLE	DOC. NO.	POST. REF.	DEBIT	CREDIT
1	20-1 Dec. 31				fill in the blank 6402cd09b01a067_2	fill in the blank 6402cd09b01a067_3	1
2					fill in the blank 6402cd09b01a067_5	fill in the blank 6402cd09b01a067_6	2
3					fill in the blank 6402cd09b01a067_8	fill in the blank 6402cd09b01a067_9	3

(d) Reversing entry for the beginning of 20-2.

Page:

	DATE	ACCOUNT TITLE	DOC. NO.	POST. REF.	DEBIT	CREDIT
1	20-2 Jan. 1				fill in the blank ff36a608bfd2059_2	fill in the blank ff36a608bfd2059_3	1
2					fill in the blank ff36a608bfd2059_5	fill in the blank ff36a608bfd2059_6	2
3					fill in the blank ff36a608bfd2059_8	fill in the blank ff36a608bfd2059_9	3

(e) Interest payments and discount amortization on the bonds for 20-2 (March 31 and September 30).

Page:

	DATE	ACCOUNT TITLE	DOC. NO.	POST. REF.	DEBIT	CREDIT
1	20-2 Mar. 31				fill in the blank f8558ff73008fa8_2	fill in the blank f8558ff73008fa8_3	1
2					fill in the blank f8558ff73008fa8_5	fill in the blank f8558ff73008fa8_6	2
3					fill in the blank f8558ff73008fa8_8	fill in the blank f8558ff73008fa8_9	3
4							4
5	Sept. 30				fill in the blank f8558ff73008fa8_11	fill in the blank f8558ff73008fa8_12	5
6					fill in the blank f8558ff73008fa8_14	fill in the blank f8558ff73008fa8_15	6
7					fill in the blank f8558ff73008fa8_17	fill in the blank f8558ff73008fa8_18	7

2. Calculate the carrying value of the bonds on September 30, 20-2.

$fill in the blank 895e0d0c903d075_1