Question
The following section is taken from Wildhorse's balance sheet at December 31, 2021. Current liabilities Interest payable $ 51,000 Long-term liabilities Bonds payable (9%, due
The following section is taken from Wildhorse's balance sheet at December 31, 2021.
| Current liabilities | ||
| Interest payable | $ 51,000 | |
| Long-term liabilities | ||
| Bonds payable (9%, due January 1, 2025) | 610,000 |
Interest is payable annually on January 1. The bonds are callable on any annual interest date.
| (a) | Journalize the payment of the bond interest on January 1, 2022. | |
| (b) | Assume that on January 1, 2022, after paying interest, Wildhorse calls bonds having a face value of $205,000. The call price is 108. Record the redemption of the bonds. | |
| (c) | Prepare the adjusting entry on December 31, 2022, to accrue the interest on the remaining bonds. |
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Managerial Accounting Information For Decisions
Authors: Thomas L. Albright , Robert W. Ingram, John S. Hill
4th Edition
0324222432, 978-0324222432
