Question
Journalize the following transactions 2017 Jan 2. Issued 7 percent 10 year bond with maturity value of $5,000,000 at 97.00. Jan 2. Signed a five
Journalize the following transactions
2017
Jan 2. Issued 7 percent 10 year bond with maturity value of $5,000,000 at 97.00.
Jan 2. Signed a five year capital lease on equipment. The agreement requires annual lease payment of $400,000, with the first payment due immediatelt( BGN). The present value of the five lease payments is $1,724,851 (8 percent is the interest rate).
July 2. Paid semi annual interest and amortized the discount by the straight line method on the 7 percent bonds
Dec 31. Accrued semi annual interest expense and amortized the discounts by the SLM on the 7 perecent bonfd.
31. Recorded amortization on the leased equipment using SLM ( five years )
31. Accrued interst expense at 8 percent on the lease liability.
2027
Jan 2. Paid the 7 percent bonds at maturity. ( Ignore the final interest payment).
Show calculations for every transactions.
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