Reference no: EM133108810
Question - Stilton Hotels Inc. issued 15-year bonds dated July 1, 2021. The bonds were issued on October 1, 2021, with accrued interest. Interest was payable on the bonds on January 1 and July 1 of each year. The company's year-end was December 31. Stilton followed ASPE and chose to use the straight-line amortization method. On June 30, 2024, Stilton retired a portion of the bond issue, paying any accrued interest at that date. Additional information pertaining to the bond issue follows:
Face value of bonds $5,242,000
Issue price of bonds 103
Bond coupon rate 6%
Portion of bond issue retired 35%
Bond retirement (repurchase) price 99
Required -
1. Prepare the journal entry for the issuance of the bonds on October1, 2021.
2. Prepare any journal entries required on December31, 2021 and July 1, 2022.
3. Prepare any journal entries required for the retirement of a portion of the bond issue on June 30, 2024.
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