Prepare the journal entry to record the issuance of bonds

Assignment Help Financial Accounting

Reference no: EM13866611

Cupola Fan Corporation issued 12%, $580,000, 10-year bonds for $552,000 on June 30, 2013. Debt issue costs were $3,300. Interest is paid semiannually on December 31 and June 30. One year from the issue date (July 1, 2014), the corporation exercised its call privilege and retired the bonds for $560,000. The corporation uses the straight-line method both to determine interest expense and to amortize debt issue costs.

1. Prepare the journal entry to record the issuance of the bonds.

2. Prepare the journal entries to record the payment of interest and amortization of debt issue costs on December 31, 2013.

3. Prepare the journal entries to record the payment of interest and amortization of debt issue costs on June 30, 2014.

4. Prepare the journal entry to record the call of the bonds.

Reference no: EM13866611

Questions Cloud

Appropriation has sufficient funding to pay for obligation : An agency has single-year, multi-year and no-year appropriations. On October 15, 2014, the agency tried to create several transactions. Is the agency authorized (allowed legally) for the following? The appropriation has sufficient funding to pay for ..

Bond issue proceeds increase shareholders equity : On March 1, 2013, E Corp. issued $1,400,000 of 8% nonconvertible bonds at 103, due on February 28, 2023. Each $1,000 bond was issued with 30 detachable stock warrants, each of which entitled the holder to purchase, for $75, one share of Evan's $25 pa..

Restrictions of retained earnings may result : Restrictions of retained earnings may result from each of the following except: Tina Corporation issued 4,000 shares of $10 par value common stock in exchange for a truck. The truck had a fair market value of $65,000. The entry to record this transac..

Number of common shares outstanding and net income : Powder Corporation declared, but had not yet paid, dividends on the 10,000 shares of 6%, $10 par value cumulative preferred stock it had outstanding for the year. The weighted average number of common shares outstanding and net income for the year we..

Prepare the journal entry to record the issuance of bonds : Cupola Fan Corporation issued 12%, $580,000, 10-year bonds for $552,000 on June 30, 2013. Debt issue costs were $3,300. Interest is paid semiannually on December 31 and June 30. Prepare the journal entry to record the issuance of the bonds. Prepare t..

Difference between managerial and financial accounting : Provide an alternative perspective on the difference between managerial and financial accounting and discuss an example related to managerial accounting, and offering examples of the importance of managers knowing and understanding managerial account..

Weighted average number of shares outstanding-earnings ratio : Ale Corporation had net income of $240,000 and paid dividends to common stockholders of $40,000 in 2014. The weighted average number of shares outstanding in 2014 was 60,000 shares. Ale Corporation's common stock is selling for $76 per share on the N..

Asset turnover measures : Asset turnover measures. how often a company replaces its assets.

Weighted average number of common shares outstanding : Powder Corporation declared, but had not yet paid, dividends on the 10,000 shares of 6%, $10 par value cumulative preferred stock it had outstanding for the year. The weighted average number of common shares outstanding and net income for the year we..

User Account

All Pages