Question
Mellilo Corporation issued $6,000,000 of 20-year, 9.5 percent bonds on July 1, 2013, at 98. Interest is due on June 30 and December 31 of
Mellilo Corporation issued $6,000,000 of 20-year, 9.5 percent bonds on July 1, 2013, at 98. Interest is due on June 30 and December 31 of each year, and all of the bonds in the issue mature on June 30, 2033. Mellilo's financial year ends on December 31. Prepare the following journal entries: |
a. | Prepare the journal entry at July 1, 2013, to record the issuance of the bonds. (Omit the "$" sign in your response.) |
Date | General Journal | Debit | Credit | |
July 1, 2013 | (Click to select)Discount on bonds payable Accounts payableAccounts receivableBond interest payableBonds payable CashSalesBond interest expense | |||
(Click to select)Bond interest payableSalesDiscount on bonds payable CashAccounts payableBonds payable Accounts receivableBond interest expense | ||||
(Click to select)Bond interest payableAccounts payableDiscount on bonds payableBond interest expenseAccounts receivableSalesBonds payableCash | ||||
b. | Prepare the journal entry at December 31, 2013, to pay interest and amortize the bond discount. (Omit the "$" sign in your response.) |
Date | General Journal | Debit | credit | |
Dec. 31, 2013 | (Click to select)Discount on bonds payableBond interest payableBonds payableAccounts receivableSalesAccounts payableCashBond interest expense | |||
(Click to select)Accounts payableAccounts receivableCashBonds payable SalesBond interest expenseBond interest payableDiscount on bonds payable | ||||
(Click to select)Bond interest payableCashSalesBond interest expenseBonds payable Accounts payableAccounts receivableDiscount on bonds payable | ||||
c. | Prepare the journal entry at June 30, 2033, to pay interest, amortize the bond discount, and retire the bonds at maturity. (Omit the "$" sign in your response.) |
Date | General Journal | Debit | Credit | |
June 30, 2033 | (Click to select)Accounts payableBonds payableSalesDiscount on bonds payableBond interest expenseAccounts receivableBond interest payableCash | |||
(Click to select)Bond interest expenseCashBonds payable Discount on bonds payable Accounts payableBond interest payable Accounts receivableSales | ||||
(Click to select)Accounts payableSalesDiscount on bonds payable CashBonds payable Accounts receivableBond interest expenseBond interest payable | ||||
June 30, 2033 | (Click to select)Accounts receivableCashBond payableDiscount on bonds payableAccounts payableBond interest payableSalesBond interest expense | |||
(Click to select)Bond payableBond interest expenseAccounts payableAccounts receivableCashDiscount on bonds payableSalesBond interest payable | ||||
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started