Bond Transactions
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Question 15:
Doe Co. issued $10,000,000 of 30-year, 8% bonds on May 1 of the current year, 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:
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.
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Solution Summary
The solution explains the journal entries related to some bond transactions.
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On May 1 the bonds are issued,the firm has received cash against the bonds. The Journal entry is
May 1 Cash Dr...............10,000,000
Bonds Payable ...
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