Bonds Payable Journal Entries; Straight-Line Interest Amortization

On December 31, 2017, Brown Company issued $650,000 of 20-year, eight percent bonds payable for $538,466, 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, 2018, and (c) the semiannual interest payment and discount amortization on December 31, 2018.

Round answers to the nearest dollar.

Question 9 Partially correct Mark 2.08 out of 2.50 P Flag question Bonds Payable Journal Entries; Straight-Line Interest Amortization On December 31, 2017, Brown Company issued $650,000 of 20-year, eight percent bonds payable for $538,466, 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, 2018, and (c) the semiannual interest payment and discount amortization on December 31, 2018. Round answers to the nearest dollar. Credit 0 Debit 538,466 111,534 0 0 650,000 X 0 General Journal Date Description (a) 12/31/17 Cash Discount on bonds payable Bonds payable To record issuance of bonds at a discount. (b) 06/30/18 Bond interest expense Discount on bonds payable Cash To record semiannual payment and discount amortization. (c) 12/31/18 Bond interest expense Discount on bonds payable Cash To record semiannual payment and discount amortization. 0 2,788 0 X x 0 0 2,788 0 x