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Whispering Co. is building a new hockey arena at a cost of $2,360,000. It received a downpayment of $510,000 from local businesses to support the
Whispering Co. is building a new hockey arena at a cost of $2,360,000. It received a downpayment of $510,000 from local businesses to support the project, and now needs to borrow $1,850,000 to complete the project. It therefore decides to issue $1,850,000 of 11%, 10-year bonds. These bonds were issued on January 1, 2019, and pay interest annually on each January 1. The bonds yield 10%. Prepare the journal entry to record the issuance of the bonds on January 1, 2019. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to 0 decimal places e.g. 58,971. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Debit Credit Date Account Titles and Explanation January 1, 2019 Cash 1,963,674 Bonds Payable 1,850,000 Premium on Bonds Payable 113,674 eTextbook and Media List of Accounts Prepare a bond amortization schedule up to and including January 1, 2023, using the effective interest method. (Round answers to 0 decimal places, e.g. 38,548.) Cash Interest Expense Premium Amortization Carrying Amount of Bonds Date Paid 1/1/19 $ 203,500 1/1/20 203,500 1/1/21 203,500 1/1/22 203,500 1/1/23 203,500 e Textbook and Media e Textbook List of Accounts Assume that on July 1, 2022, Whispering Co. redeems half of the bonds at a cost of $1,014,800 plus accrued interest. Prepare the journal entry to record this redemption. (Round answers to 0 decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Debit Credit Date Account Titles and Explanation July 1, 2022 (To record interest) July 1, 2022 (To record reacquisition) eTextbook and Media e Textbook
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