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Yellowknife Aerospace Inc. raised $4,990,510 by selling $5,000,000 of six-year, 4% bonds dated January 1, 2021. Yellowknife used part of the proceeds to pay its
Yellowknife Aerospace Inc. raised $4,990,510 by selling $5,000,000 of six-year, 4% bonds dated January 1, 2021. Yellowknife used part of the proceeds to pay its investment bank's fee of $200,000 and related legal and accounting fees of $400,000. Interest is payable on June 30 and December 31 each year. Yellowknife can call the bonds on January 1, 2024, at 101. The company exercises this privilege, redeeming 50% of the bonds on the call date and retiring them. The company's year-end is December 31. Required a. Prepare the journal entry to record the issuance of the bonds on January 1, 2021. Required Prepare journal entries to record: a. the issuance of the bonds on January 1, 2021. b. payment of interest and related amortization on December 31, 2023. c. repurchase of the bonds on January 1, 2024. d. retirement of the remaining bonds on December 31, 2026, assuming that the final interest payment has already been recorded in the company's books. (Record debits first, then credits. Explanations are not required.) Print Done
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