On January 1, 2017, Boston Enterprises issues bonds that have a $2,100,000 par value, mature in 20 years, and pay 7% interest semiannually on June 30 and December 31. The bonds are sold at par. 1. How much interest will Boston pay (in cash) to the bondholders every six months? 2. Prepare journal entries to record (a) the issuance of bonds on January 1, 2017; (b) the first interest payment on June 30, 2017; and (c) the second interest payment on December 31, 2017. 3. Prepare the journal entry for issuance assuming the bonds are issued at (a) 98 and (b) 102.

Complete this question by entering your answers in the tabs below.

How much interest will Boston pay (in cash) to the bondholders every six months?

Par (maturity) Value		Semiannual Rate		Semiannual Cash Interest Payment
	x		=

Prepare journal entries to record (a) the issuance of bonds on January 1, 2017; (b) the first interest payment on June 30, 2017; and (c) the second interest payment on December 31, 2017.

Journal entry worksheet

Record the issue of bonds at par on January 1, 2017.

Date	General Journal	Debit	Credit
Jan 01, 2017

Record the interest payment on June 30, 2017.

Date	General Journal	Debit	Credit
Jun 30, 2017

Record the interest payment on December 31, 2017.

Date	General Journal	Debit	Credit
Dec 31, 2017

Prepare the journal entry for issuance assuming the bonds are issued at (a) 98 and (b) 102.

Journal entry worksheet

Record the issue of bonds at 98.

Date	General Journal	Debit	Credit
Jan 01, 2017

Record the issue of bonds at 102.

Date	General Journal	Debit	Credit
Jan 01, 2017