Pharoah Corporation issued3,600,9%, 5-year, $1,000bonds dated January 1, 2020, at100. Interest is paid each January 1.

(a)

Prepare the journal entry to record the sale of these bonds on January 1, 2020.(Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date

Account Titles and Explanation

Debit

Credit

Janaury 1, 2020

(b)

Prepare the adjusting journal entry on December 31, 2020, to record interest expense.(Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date

Account Titles and Explanation

Debit

Credit

December 31, 2020

(c)

Prepare the journal entry on January 1, 2021, to record interest paid.(Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date

Account Titles and Explanation

Debit

Credit

January 1, 2021

Brief Exercise 15-11

Blossom Company leases a new building from Noble Construction, Inc. The present value of the lease payments is $500,000. The lease is a finance lease.Prepare the journal entry that the lessee should make to record this transactions.(Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Account Titles and Explanation

Debit

Credit