229359828-ACC-291-Week-3-Learning-Team-Reflection.docx

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Learning Team Reflection Teresa Watkins January 9, 2014 ACC 291 Michael Bluvas
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There are three stages in which bonds are recorded. Acquisition is the first, interest is the second, and sale is the third. To record a journal entry for the first stage, the costs of the bond and brokerage fees are listed under debt investments as a debit and as a credit under cash. To record bond interest, the initial costs of the purchased bonds are multiplied by the annual interest which equals to the annual amount of paid interest. In the event it’s semiannual, to get the amount for half the year multiply the amount by .5. Your total is listed as a debit under cash and as a credit under interest revenue. When using the effective interest method the amortization of premiums and bond interest
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