7252569-MIdterm-1 (dragged) 21

If the entire bond issue is sold at par on march 1

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: entire bond issue is sold at par on March 1, 2004, the following journal entry would be made by the seller: Cash 304,500 300,000 4,500* Bonds Payable Bond Interest Expense *($300,000 x .09 x 1/6) The entry for the semi-annual interest payment on July 1, 2004, would be as follows: Bond Interest Expense Cash 13,500 13,500 The total bond interest expense for the six-month period is $9,000 ($13,500 - $4,500), which represents the correct interest expense for the four month period the bonds were outstanding. 13. Bond pr...
View Full Document

This note was uploaded on 03/28/2012 for the course ACCTG ACC423 taught by Professor Smith during the Spring '10 term at University of Phoenix.

Ask a homework question - tutors are online