Reporting Issuance and Retirement of Long-Term Debt

On the basis of the details of the following bonds payable and related discount accounts, indicate the items to be reported in the Financing Activities section of the statement of cash flows, assuming no gain or loss on retiring the bonds:

ACCOUNT Bonds Payable

ACCOUNT NO.

Balance

Date

Item

Debit

Credit

Debit

Credit

Jan.

1

Balance

320,000

Jan.

2

Retire bonds

64,000

256,000

June

30

Issue bonds

192,000

448,000

ACCOUNT Discount on Bond Payable

ACCOUNT NO.

Balance

Date

Item

Debit

Credit

Debit

Credit

Jan.

1

Balance

14,400

Jan.

2

Retire bonds

5,120

9,280

June

30

Issue bonds

12,900

22,180

Dec.

31

Amortize discount

1,110

21,070

Item	Section of Statement of Cash Flows	Added or Deducted	Amount
Retire bonds	Financing activities section	Deducted	$
Issue bonds	Financing activities section	Added	$
Amortization of discount	Operating activities section, if indirect method used	Added	$