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Posted by: Homeworkhelp
Price Quoted by Student: $8
Posted On: 2018-01-30 05:05:38
 
Question
Presented below are selected transactions on the books of Simonson Corporation.
 
P14-6 (Issuance of Bonds between Interest Dates, Straight-Line, Redemption) Presented below are selected transactions on the books of Simonson Corporation.
 
P14-6 Simonson Corporation
 
01-May-14
Dec. 31
Jan. 1, 2015 April 1
Dec. 31
 
Instructions
Bonds payable with a par value of $900,000, which are dated January 1, 2014, are sold at 106 plus accrued interest. They are coupon bonds, bear interest at 12% (payable annually at January 1), and mature January 1, 2024. (Use interest expense account for accrued interest.) Adjusting entries are made to record the accrued interest on the bonds, and the amortiza- tion of the proper amount of premium. (Use straight-line amortization.) Interest on the bonds is paid. Bonds with par value of $360,000 are called at 102 plus accrued interest, and redeemed. (Bond premium is to be amortized only at the end of each year.) Adjusting entries are made to record the accrued interest on the bonds, and the proper amount of premium amortized. (Round to two decimal places.)
 
Prepare journal entries for the transactions above.
 
TUTORIAL PREVIEW
P14-6
01-May-14
Cash  ($900,000 X 106%) + ($900,000 X 12% X 4/12)
990,000
 
 
     Bonds Payable
 
900,000.00
 
     Premium on Bonds Payable
 
54,000.00
 
     Interest Expense ($900,000 X 12% X 4/12)
 
36,000.00
 
File name P14-6 Simonson.xls File type: doc PRICE: $8

Solutions
TUTORIAL PREVIEW P14-6 01-May-14 Ca
Price $8
Attachment 1: P14-6 Simonson.xls
Solution Posted By: Homeworkhelp    Posted on: 30-01-2018