Bonds Payable Journal Entries; Issued at Par Plus Accrued Interest Cheney, Inc., which closes its books on December 31, is authorized to issue $1,100,000 of nine percent, 20 year bonds dated March 1, with interest payments on September 1 and March 1. Required Prepare journal entries to record the following events, assuming that the bonds were sold at 100 plus accrued interest on July 1. a. The bond issuance. b. Payment of the semiannual interest on September 1. c. Accrual of bond interest expense at December 31. d. Payment of the semiannual interest on March 1 of the following year. e. Retirement of $200,000 of the bonds at 101 on March 1, Year 3 (immediately after the interest payment on that date). Round to the nearest dollar. Use 360 days for calculations.

General Journal
Date	Description	Debit	Credit
a.
Jul.1	CashBonds PayableBond Interest PayableBond Interest ExpenseLoss on Bond Retirement
	Bonds Payable
	CashBonds PayableBond Interest PayableBond Interest ExpenseLoss on Bond Retirement
	Issuance of bonds plus accrued interest.
b.
Sept.1	Bond Interest Payable
	CashBonds PayableBond Interest PayableBond Interest ExpenseLoss on Bond Retirement
	CashBonds PayableBond Interest PayableBond Interest ExpenseLoss on Bond Retirement
	To record semiannual interest payment.
c.
Dec.31	CashBonds PayableBond Interest PayableBond Interest ExpenseLoss on Bond Retirement
	CashBonds PayableBond Interest PayableBond Interest ExpenseLoss on Bond Retirement
	To accrue interest expense.
d.
Mar.1	Bond Interest Payable
	CashBonds PayableBond Interest PayableBond Interest ExpenseLoss on Bond Retirement
	CashBonds PayableBond Interest PayableBond Interest ExpenseLoss on Bond Retirement
	To record semiannual interest payment.
e.
Mar.1	Bonds Payable
	CashBonds PayableBond Interest PayableBond Interest ExpenseLoss on Bond Retirement
	CashBonds PayableBond Interest PayableBond Interest ExpenseLoss on Bond Retirement
	To record retirement of bonds.