Reference no: EM132597061

Questions -

Q1) Thomson Co. produces and distributes semiconductors for use by computer manufacturers. Thomson Co. issued $540,000 of 10-year, 11% bonds on May 1 of the current year at face value, with interest payable on May 1 and November 1. The fiscal year of the company is the calendar year.

Journalize the entries to record the following selected transactions for the current year. Refer to the Chart of Accounts for exact wording of account titles.

May 1 Issued the bonds for cash at their face amount.

Nov. 1 Paid the interest on the bonds.

Dec. 31 Recorded accrued interest for two months.

Q2) Adele Corp., a wholesaler of music equipment, issued $33,100,000 of 20-year, 4% callable bonds on March 1, 20Y1, at their face amount, with interest payable on March 1 and September 1. The fiscal year of the company is the calendar year.

Journalize the entries to record the following selected transactions. Refer to the Chart of Accounts for exact wording of account titles.

20Y1

Mar.1 Issued the bonds for cash at their face amount.

Sept.1 Paid the interest on the bonds.

20Y5

Sept.1 Called the bond issue at 102, the rate provided in the bond indenture. (Omit entry for payment of interest.)