Answered step by step
Verified Expert Solution
Question
1 Approved Answer
PLEASE HELP!! On January 1, 2021, Surreal Manufacturing issued 520 bonds, each with a face value of $1,000, a stated interest rate of 3 percent
PLEASE HELP!!
On January 1, 2021, Surreal Manufacturing issued 520 bonds, each with a face value of $1,000, a stated interest rate of 3 percent paid annually on December 31, and a maturity date of December 31, 2023. On the issue date, the market interest rate was 4 percent, so the total proceeds from the bond issue were $505,572. Surreal uses the effective-interest bond amortization method and adjusts for any rounding errors when recording interest in the final year. Required: 1. Prepare a bond amortization schedule. 2-5. Prepare the journal entries to record the bond issue, the interest payments on December 31, 2021 and 2022, the interest and face value payment on December 31, 2023 and the bond retirement. Assume the bonds are retired on January 1, 2023, at a price of 101. Complete this question by entering your answers in the tabs below. Prepare the journal entries to record the bond issue, the interest payments on December 31, 2021 and 2022, the interest and fac payment on December 31, 2023 and the bond retirement. Assume the bonds are retired on January 1, 2023, at a price of 101. (If entry is required for a transaction/event, select "No Journal Entry Required" in the first account field. Round your answers to the n, whole dollar amount.) Complete this question by entering your answers in the tabs below. Prepare a bond amortization schedule. (Round your answers to the nearest whole dollar. Make sure that the Carrying value equals face value of the bond in the last period. Interest expense in the last period will result in the amount in Discount Amortized equaling Discount on Bonds Payable.) Journal entry worksheet Record the issuance of 520 bonds at face value of $1,000 each for $505,572. Note: Enter debits before credits. 1 Record the issuance of 520 bonds at face value of $1,000 each for $505,572. 2 Record the interest payment on December 31, 2021. 3 Record the interest payment on December 31, 2022. 4 Record the interest and face value payment on December 31, 2023. 5 Record the retirement of the bonds at a quoted price of 101, assuming the bonds are retired on January 1, 2023. Note : O= journal entry has been enteredStep 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