Question
HiLi Corporation had the following bond issue: Date of issue/sale: May 1, 20-A Principal: $500,000 Sale price of bonds: 100 Life of bonds: 10 years
HiLi Corporation had the following bond issue:
| Date of issue/sale: | May 1, 20-A |
| Principal: | $500,000 |
| Sale price of bonds: | 100 |
| Life of bonds: | 10 years |
| Stated rate: | 6% a year payable semiannually on October 31 and April 30 |
Required:
Prepare the following general journal entries.
a. The issuance of the bonds on May 1, 20-A.
b. The first interest payment for 20-A.
c. The adjusting entry for December 31, 20-A.
d. The reversing entry for January 1, 20-B.
If an amount box does not require an entry, leave it blank.
| DATE | DESCRIPTION | POST. REF. | DEBIT | CREDIT | ||
|---|---|---|---|---|---|---|
| 1 | a. May 1 | 1 | ||||
| 2 | 2 | |||||
| 3 | 3 | |||||
| 4 | b. Oct. 31 | 4 | ||||
| 5 | 5 | |||||
| 6 | 6 | |||||
| 7 | c. Dec. 31 | 7 | ||||
| 8 | 8 | |||||
| 9 | 9 | |||||
| 10 | d. Jan. 1 | 10 | ||||
| 11 | 11 |
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Principles of Auditing and Other Assurance Services
Authors: Ray Whittington, Kurt Pany
19th edition
978-0077804770, 78025613, 77804775, 978-0078025617
