Reference no: EM132598265

Question -

. On November 16, 2015, Williams Industrial gave Phillip Co. a 90-day, 8%, $80,000 note payable to extend a past due account payable. Prepare the journal entry for Williams Industrial to record payment of the note on Feb 14, 2016. Williams Industrial recorded a December 31st year end adjusting entry.

2. On January 1, 2017, British Software Ltd. issued $450,000 of 20-year, 8% bonds that pay interest semiannually on June 30 and December 31. The bonds were sold to investors at their par value.

a. How much interest will British pay to the holders of these bonds every six months?

b. Prepare the journal entries that British would make to record: (1) the issuance of the bonds on January 1, 2017; (2) the first interest payment on June 30, 2017; and (3) the second interest payment on December 31, 2017.

3. On March 1, 2017, Jagger Metal Corp. issued 8% bonds dated January 1, 2017. The bonds have a $900,000 par value, mature in 20 years, and pay interest semiannually on June 30 and December 31. The bonds were sold to investors at their par value plus the two months' interest that had accrued since the original issue date.

a. How much accrued interest was paid to Jagger by the purchasers of these bonds on March 1, 2017?

b. Prepare the journal entries that Jagger would make to record: (1) the issuance of the bonds on March 1, 2017; (2) the first interest payment on June 30, 2017; and (3) the second interest payment on December 31, 2017.