CP 105

Gaudette Inc. issued 3year, 12per cent bonds on January 1, 2019, the date of bond authorization. Semiannual interest is payable on June 30 and December 31. Gaudette uses the straightline method of amortization. The following journal entry records the payment of interest on December 31, 2019:

2019

Dec. 31 Interest Expense 17,900

Premium on Bonds 100

Cash 18,000

Required:

Reconstruct the entry made to record the issuance of bonds on January 1,2019.

-Can you break it down and shoe me how it's done, I'd like to understand how I get the answer.

Thank You