Shor Company: Calculate and prepare Bond Journal Entries
Not what you're looking for?
During the year Shor Company issued several series of bonds. For each bond, record the journal entry that must be made upon the issuance date (Round to the nearest dollar; a calculator is needed for 2 and 3.
1. On March 15, a 20-year, $5000 par value bond series with annual interest of 9 percent was issued. Three thousand of these bonds were issued at a price of 98. Interest is paid semiannually.
2. On January 20, a series of 15-year, $1000 par value bonds with annual interest of 88 percent was issued at a price given a current yield to maturity of 6.5 percent. Issuance costs for the 7,000 bonds issued were $250,000. Interest is paid annually.
3. On October 31, a 10-year, $1,000 par value bond series with annual interest of 7 percent was issued at a price to give a current yield to maturity of 8 percent. interest on the %, 000 bonds issued is paid semiannually.
Purchase this Solution
Solution Summary
The expert calculates and prepares bond journal entries for Shor Company.
Solution Preview
ANSWERS
Please see attached file for answers.
Transaction Date Account Debit Credit
1 Mar 15 Cash 14,700,000 (3,000 x $5,000 x 98%)
Discount on bonds payable 300,000
Bonds 15,000,000 (3,000 x $5,000)
2 Jan 20 Cash 7,987,280 ...
Purchase this Solution
Free BrainMass Quizzes
Understanding Management
This quiz will help you understand the dimensions of employee diversity as well as how to manage a culturally diverse workforce.
Marketing Management Philosophies Quiz
A test on how well a student understands the basic assumptions of marketers on buyers that will form a basis of their marketing strategies.
Paradigms and Frameworks of Management Research
This quiz evaluates your understanding of the paradigm-based and epistimological frameworks of research. It is intended for advanced students.
Lean your Process
This quiz will help you understand the basic concepts of Lean.
Change and Resistance within Organizations
This quiz intended to help students understand change and resistance in organizations