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Blossom Company issues $390,000, 20-year, 8% bonds at 101. Prepare the journal entry to record the...

Blossom Company issues $390,000, 20-year, 8% bonds at 101. Prepare the journal entry to record the sale of these bonds on June 1, 2020.

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Answer #1
Date Account Titles and Explanation Debit Credit
June 1, 2020 Cash                                        [$390,000 x 101%] $393,900
    Bonds Payable $390,000
    Premium on bonds payable      [$309,000 x (101% - 100%)] $3,900
(To record bonds issued at a premium of 1%)
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