Question
OnJanuary1,2016,theRanglerCompanyissued$700,000ofeight-yearbondsat102.Thestatedannualinterest rateis8%,andinterestispaidonJune30andDecember31.Thebondsarecallableat104 plusaccruedinterest. Thebondissuecostswere$7,200.TheRanglerCompanyusesthestraight-linemethodtoamortizebonddiscounts andpremiums. Required: a. Preparethejournalentry(ies)torecordtheissuanceofthebondsandthebondissuecosts. b. Attheendofthesixthyear,thecompanyexercisedthecalloptionandretiredthebonds. Preparethejournalentriestorecordtherelatedinterestandretirement. **PLEASE SHOW ALL WORK & CALCULATIONS**
OnJanuary1,2016,theRanglerCompanyissued$700,000ofeight-yearbondsat102.Thestatedannualinterest rateis8%,andinterestispaidonJune30andDecember31.Thebondsarecallableat104 plusaccruedinterest. Thebondissuecostswere$7,200.TheRanglerCompanyusesthestraight-linemethodtoamortizebonddiscounts andpremiums.
Required:
a. Preparethejournalentry(ies)torecordtheissuanceofthebondsandthebondissuecosts.
b. Attheendofthesixthyear,thecompanyexercisedthecalloptionandretiredthebonds. Preparethejournalentriestorecordtherelatedinterestandretirement.
**PLEASE SHOW ALL WORK & CALCULATIONS**
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
Financial & Managerial Accounting
Authors: Carl S. Warren, James M. Reeve, Jonathan Duchac
13th edition
