Wk1 D2 - Post Ref. Debit Credit C. Jan. 1Cash (50,000 x...

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
E15-17 (10-15 min.) Journal Date Accounts and Explanations Post Ref. Debit Credit 2006 a. Mar 31Cash 400,000 Bonds Payable 400,000 Issued Bonds b. Sep. 30Interest Expense (400,000 x .07 x 6/12) 14,000 Cash 14,000 Paid semiannual interest c. Dec. 31Interest expense (400,000 x .07 x 3/12) 7,000 Cash 7,000 Paid quarterly interest 2007 d. Mar. 31Interest payable from Dec. 31 7,000 Interest expense for Jan., Feb., Mar. 7,000 Cash (400,000 x .07 x 6/12) 14,000 Paid interest
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
E15-18 (15-20 min.) Journal Date Accounts and Explanations Post Ref. Debit Credit a. Jan. 1Cash 50,000 Bonds payable 50,000 Issued bonds July 1Interest expense (50,000 x .06 x 6/12) 1,500 Cash 1,500 Paid semiannual interest Journal Date Accounts and Explanations Post Ref. Debit Credit b. Jan. 1Cash (50,000 x 0.95) 47,500 Discounts on bonds payable 2,500 Bonds payable 50,000 Issued bonds at discount July 1Interest expense 1,625 Cash (50,000 x 0.06 x 6/12) 1,500 Discount on bonds payable (2,500/20) 125 Paid interest and amoritized discount
Background image of page 2
Journal Date Accounts and Explanations
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Background image of page 4
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Post Ref. Debit Credit C. Jan. 1Cash (50,000 x 1.05) 52,500 Bonds payable 50,000 Premium on bonds payable 2,500 Issued bonds at a premium July 1Interest expense 1,375 Premium on bonds payable (2,500/20) 125 Cash (50,000 x 0.06 x 6/12) 1,500 Paid interest and amortized premium Req. 2 Answer: Having the bond at a price of 95 in causing Columbus more interest expense. Not only are they losing money by issuing at a lower cost, but they are also eating the the excess percentage of interest while the bond is worth less than market value. E15-25 (10 min.) LIABILITIES Current liabilities: Accounts payable $50,000 Interest payable 20,000 Salary payable 10,000 Income tax payable 8,000 Interest payable (bond) 7,000 Current liabilities: $95,000 Long-term liabilities Bond payable (long-term) 180,000 Total long-term liabilities $180,000 Total combined liabilities $275,000...
View Full Document

Page1 / 4

Wk1 D2 - Post Ref. Debit Credit C. Jan. 1Cash (50,000 x...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online