Issuing bonds at face amount Instructions Chart of Accounts Journal Instructions On January 1, the first day of the fiscal year, a company issues a $300,000, 9%, 10-year bond that pays semiannual interest of $13,500 ($300,000 x 9% x V2 year), receiving cash of $300,000. Journalize the entries to record (a) the issuance of the bonds, (b) the first interest payment on June 30, and (c) the payment of the principal on the maturity date December 31. Refer to the Chart of Accounts for exact wording of account titles. Chart of Accounts CHART OF ACCOUNTS General Ledger ASSETS REVENUE 110 Cash 111 Petty Cash 121 Accounts Receivable 122 Allowance for Doubtful Accounts 410 Sales 610 Interest Revenue 611 Gain on Redemption of Bonds 126 Interest Receivable EXPENSES 127 Notes Receivable 510 Cost of Merchandise Sold 515 Credit Card Expense 131 Merchandise Inventory 131 Merchandise Inventory 141 Office Supplies 515 Credit Card Expense 516 Cash Short and Over 191 Land 194 Office Equipment 195 Accumulated Depreciation Office Equipment 522 Office Salaries Expense 531 Advertising Expense 532 Delivery Expense 533 Repairs Expense 535 Rent Expense LIABILITIES 210 Accounts Payable 536 Insurance Expense 221 Salaries Payable 537 Office Supplies Expense 231 Sales Tax Payable 541 Bad Debt Expense 232 Interest Payable 562 Depreciation Expense-Office Equipment 241 Notes Payable 590 Miscellaneous Expense 251 Bonds Payable 710 Interest Expense 711 Loss on Redemption of Bonds 252 Discount on Bonds Payable 253 Premium on Bonds Payable EQUITY 311 Common Stock 312 Paid-In Capital in Excess of Par-Common Stock 315 Treasury Stock 321 Preferred Stock 321 Preferred Stock 322 Paid-In Capital in Excess of Par-Preferred Stock 331 Paid-In Capital from Sale of Treasury Stock 340 Retained Earnings 351 Cash Dividends 352 Stock Dividends 390 Income Summary Journal Journalize the entries to record (a) the issuance of the bonds, (b) the first interest payment on June 30, and (c) the payment of the principal on the maturity date December 31. Refer to the Chart of Accounts for exact wording of account titles. PAGE 10 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY