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The board of directors of Allen Services Inc. authorized the issuance of $560,000 face value, 20-year, 5 percent bonds dated April 1, 2022, and maturing
The board of directors of Allen Services Inc. authorized the issuance of $560,000 face value, 20-year, 5 percent bonds dated April 1, 2022, and maturing on April 1, 2042. Interest is payable semiannually on April 1 and October 1. Allen uses the calendar year as its fiscal year. The bond transactions that occurred in 2022 and 2023 follow.
DATE | TRANSACTIONS FOR 2022 | ||
Apr. | 1 | Issued $336,000 of bonds at face value. | |
Oct. | 1 | Paid the semiannual interest on the bonds issued. | |
Dec. | 31 | Recorded the adjusting entry for the accrued bond interest. | |
31 | Closed the Bond Interest Expense account to the Income Summary account. |
DATE | TRANSACTIONS FOR 2023 | ||
Jan. | 1 | Reversed the adjusting entry made on December 31, 2022. | |
Apr. | 1 | Issued $112,000 of bonds at face value. | |
1 | Paid the interest for six months on the bonds previously issued. | ||
Oct. | 1 | Paid the interest for six months on the outstanding bonds. | |
Dec. | 31 | Recorded the adjusting entry for the accrued bond interest. | |
31 | Closed the Bond Interest Expense account to the Income Summary account. |
Recorded the adjusting entry for the accrued bond interest.
Dec 31, 2023 | general journal | debit | credit |
Closed the Bond Interest Expense account to the Income Summary account.
Dec 31, 2023 | general journal | debit | credit |
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