E14-3 (Entries for Bond Transactions) Presented below are two independent situations.
1.) On January 1. 2008, Paul Simon Company issued $200,000 of 9%. 10-year bonds dated June 1 at par. Interest quarterly on April 1, July 1, October 1 and January 1.
2.) On January 1, 2008, Graceland Company issued $100,000 of 12%, 10-year bonds dated June 1 at par. Interest is payable semiannually on July 1 and January 1.
Instructions
For each of these two independent situations, prepare journal entries to record:
a.) The issuance of bonds
b.) The payment of interest on July 1
c.) The accrual of interest on December 31
Click here for the solution: Presented below are two independent situations
