Question
On May 1, 2019, Whispering Winds Corp. issued $570,000, 8%, 5-year bonds at face value. The bonds were dated May 1, 2019, and pay interest
On May 1, 2019, Whispering Winds Corp. issued $570,000, 8%, 5-year bonds at face value. The bonds were dated May 1, 2019, and pay interest annually on May 1. Financial statements are prepared annually on December 31.
Prepare the journal entry to record the issuance of the bonds
Prepare the adjusting entry to record the accrual of interest on December 31, 2019.
Show the balance sheet presentation on December 31, 2019.
Prepare the journal entry to record payment of interest on May 1, 2020.
Prepare the adjusting entry to record the accrual of interest on December 31, 2020.
Assume that on January 1, 2021, Whispering Winds pays the accrued bond interest and calls the bonds at 105. Record the payment of interest and redemption of the bonds.
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Behind Closed Doors What Company Audit Is Really About
Authors: V. Beattie, R. Brandt, S. Fearnley
2001 Edition
0333747844, 978-0333747841
