Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

On February 1, Clayton Co. Issued $1,300,000 of 20 year, 9% bonds for $1,226,000. Interest is payable somiannualy on February 1 and August 1. Prosent

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
On February 1, Clayton Co. Issued $1,300,000 of 20 year, 9% bonds for $1,226,000. Interest is payable somiannualy on February 1 and August 1. Prosent the entries to record the following transactions Required: a. Issuance of the bonds. b. First semiannual interest payment record as separate entry from discount amortization), c. Using the straight-line method, compute the adjusting entry for the amortization of the bond discount premium through December 31. "Refer to the Chart of Accounts for exact wording of account bites. Round your answers to the nearest dollar amount. CHART OF ACCOUNTS Clayton Co. General Ledger ASSETS REVENUE 110 Cash 410 Sales 111 Petty Cash 610 Interest Revenue 112 Accounts Receivable 611 Gain on Redemption of Bonds 113 Allowance for Doubtful Accounts 114 Notes Receivable EXPENSES 115 Interest Receivable 510 Cost of Goods Sold 121 Inventory 511 Bad Debt Expense 512 Credit Card Expense 122 Supplies 131 Prepaid Insurance 513 Cash Short and Over 140 Land 521 Salaries Expense 151 Building 152 Accumulated Depreciation-Building 153 Equipment 531 Advertising Expense 532 Delivery Expense 533 Repairs Expense Chart of Accounts 533 Repairs Expense 153 Equipment 154 Accumulated Depreciation Equipment 534 Rent Expense 535 Insurance Expense LIABILITIES 210 Accounts Payable 536 Supplies Expense 551 Depreciation Expense-Building 552 Depreciation Expense-Equipment 221 Salaries Payable 231 Sales Tax Payable 590 Miscellaneous Expense 710 Interest Expense 241 Notes Payable 242 Interest Payable 711 Loss on Redemption of Bonds 251 Bonds Payable 252 Discount on Bonds Payable 253 Premium on Bonds Payable EQUITY 310 Common Stock 311 Retained Earnings 312 Dividends a. Issuance of the bonds on February 1. Refer to the Chart of Accounts for exact wording of account sites. Round your answers to the nearest dollar amount PAGE 1 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST, REE DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 b. First semiannual interest payment (record as separate entry from discount amortization) on August 1. Refer to the Chart of Accounts for exact wording of account titles. Round your answers to the nearest dollar amount PAGE 1 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST. REF DERIT CREDIT ASSETS EQUITY 1 2 c. Using the straight-line method, compute the adjusting entry for the amortization of the bond discount premium through December 31. Refer to the Chart of Accounts for exact wording of account titles. Round your answers to the nearest dollar amount. PAGE 1 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST. REF DEBIT CREDIT ASSETS LIABILITIES EQUITY 1

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Principles Of Auditing And Other Assurance Services

Authors: Ray Whittington, Kurt Pany

17th Edition

0077304454, 978-0077304454

More Books

Students also viewed these Accounting questions