Problem 14-7 Your answer is partially correct. Try again. On April 1, 2017, Vaughn Company sold 32,400 of its 11%, 15-year, $1,000 face value bonds at 98. Interest payment dates are April 1 and October 1, and the company uses the straight-line method of bond discount amortization. On March 1, 2018, Vaughn took advantage of favorable prices of its stock to extinguish 4,200 of the bonds by issuing 138,600 shares of its $10 par value common stock. At this time, the accrued interest was paid in cash. The company's stock was selling for $31 per share on March 1, 2018. Prepare the journal entries needed on the books of Vaughn Company to record the following. (Round intermediate calculations to 6 decimal places, e.g. 1.251247 and final answers to O decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account tities and enter o for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) (a) April 1, 2017: issuance of the bonds. (b) October 1, 2017: payment of semiannual interest. (c) December 31, 2017: accrual of interest expense. (d) March 1, 2018: extinguishment of 4,200 bonds. (No reversing entries made.) Date Account Titles and Explanation Debit Credit No. (a) 4/1/17 TCash 31,752,000 Discount on Bonds Payable 648,000 Bonds Payable 32,400,000 (b) 10/1/17 Interest Expense 1 Discount on Bonds Payable Cash 1,782,000 2 C) 12/31/17 Interest Expense Discount on Bonds Payable J 10,80 10,800 | Interest Payable 891,000 d) 3/1/18 Tinterest Payable 7 891,000 Tinterest Expense 601,200 7 1 Cash 1,485,000 Discount on Bonds Payable 7200 (To record payment to retiring bondholders) 3/1/18 Bonds Payable Loss on Redemption of Bonds 5,467 | Common Stock 86,000 Paid-in Capital in Excess of Par - Common Stock 910.600