Question
Your answer is partially correct. Try again. On January 1, 2017, Ivanhoe Corporation issued $610,000 of 9% bonds, due in 10 years. The bonds were
Your answer is partially correct. Try again. On January 1, 2017, Ivanhoe Corporation issued $610,000 of 9% bonds, due in 10 years. The bonds were issued for $571,991, and pay interest each July 1 and January 1. Ivanhoe uses the effective-interest method. Prepare the companys journal entries for (a) the January 1 issuance, (b) the July 1 interest payment, and (c) the December 31 adjusting entry. Assume an effective-interest rate of 10%. (Round intermediate calculations to 6 decimal places, e.g. 1.251247 and final answer to 0 decimal places, e.g. 38,548. 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.)
On January 1, 2017, Ivanhoe Corporation issued $610,000 of 9% bonds, due in 10 years. The bonds were issued for $571,991, and pay interest each July 1 and January 1. Ivanhoe uses the effective-interest method. Prepare the company's journal entries for (a) the January 1 issuance, (b) the July 1 interest payment, and (c) the December 31 adjusting entry. Assume an effective-interest rate of 10%. (Round intermediate calculations to 6 decimal places, e.g. 1.251247 and final answer to 0 decimal places, e.g. 38,548. 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.) Account Titles and Explanation No. Date Debit Credit (a) Jan. 1, 2017 Cash 571,991 Discount on Bonds Payable 28,009 Bonds Payable 610,000 (b) T July 1, 2017 AInterest Expense 28,600 Discount on Bonds Payable 1,150 27,450 Cash Dec. 31, 2017 Interest Expense 28,600 (c) Discount on Bonds Payable 1,150 Interest Payable 27,450Step by Step Solution
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