Bonds Payable Journal Entries; Straight$-$Line Interest Amortization

On December $31,$ Brown Company issued $$400,000$ of $20-$year, eight percent bonds payable for $$331,364,$ yielding an effective interest rate of ten percent. Interest is payable semiannually on June $30$ and December $31.$ Prepare journal entries to reflect $($a$)$ the issuance of the bonds, $($b$)$ the semiannual interest payment and discount amortization $($straight$-$line interest method$)$ on June $30,$ and $($c$)$ the semiannual interest payment and discount amortization on December $31.$

Round answers to the nearest dollar.

General Journal

Date Description Debit Credit

$($a$)12/31/$Y$1$ Cash Answer

Answer

Answer

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Answer

Answer

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To record issuance of bonds at a discount.

$($b$)06/30/$Y$2$ Answer

Answer

Answer

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Answer

Answer

Cash Answer

Answer

To record semiannual payment and discount amortization.

$($c$)12/31/$Y$2$ Answer

Answer

Answer

Answer

Answer

Answer

Cash Answer

Answer

To record semiannual payment and discount amortization.