Answered step by step
Verified Expert Solution
Question
1 Approved Answer
On January 1, 2020, Shamrock Inc. sold 12% bonds having a maturity value of $850,000 for $949,185, which provides the bondholders with a 9% yield.
On January 1, 2020, Shamrock Inc. sold 12% bonds having a maturity value of $850,000 for $949,185, which provides the bondholders with a 9% yield. The bonds are dated January 1, 2020, and mature on January 1, 2025, with interest payable on January 1 of each year. The company follows IFRS and uses the effective interest method. Your answer is correct. Prepare the journal entry at the date of issue. (Round answers to O decimal places, e.g. 5,255. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter o for the amounts.) Date Account Titles and Explanation Debit Credit Jan. 1, 2020 Cash 949185 Bonds Payable Prepare a schedule of interest expense and bond amortization for 2020 through 2023 Debit decimal places *3 5,275) Bonds Schedule of Interest Expense and Band Premium Amortization Payable Effective Interest Method Carrying Amount of Bonds $ 949185 Credit Cash Debit Interest Expense DNE 28476 0000 920709 L:1:20 1/1/21 $ 1.3902 05027 31038 889671 1/1:22 123902 33832 855839 L:1:23 19902 80020 Prepare the journal entries to record the interest payment and the amortization for 2020. (Round answers to O decimal places, e.g. 5,275. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter o for the amounts.) ate Account Titles and Explanation Debit Credit Dec. 31, 020 Interest Expense 85427 Bonds Payable 28476 Cas Jan. 1. 021 Interest Payable 85427 Cash Prepare the journal entries to record the interest payment and the amortization for 2022. (Round answers to O decimal places, e.g. 5,275. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter o for the amounts.) ate Account Titles and Explanation Debit Credit . 31, 022 Interest Expense 82864 Bonds Payable 31038 Cash Jan 1, 023 Interest Payable 82864 Cash
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered 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