Question

On June 30, Teller Industries issues 8%, 20-year bonds payable with a face value of $210,000....

On June 30, Teller Industries issues 8%, 20-year bonds payable with a face value of $210,000. The bonds are issued at 96 and pay interest on June 30 and December 31.

The entry to record the semiannual interest payment and amortization of the bond discount on December 31 would look like which of the following?

Date Accounts and Explanations Post Ref DEBIT CREDIT
1 Cash $201,600
Discount on Bonds Payable $8,400
    Bonds Payable $210,000
2 Interest Expense $8,400
    Cash $8,400
3 Interest Expense $8,610
   Discount on Bonds Payable $210
   Cash $8,400
4 Cash $8,400
   Discount on Bonds Payable $420
   Bonds Payable $7,980
5 None of the other entries

A.

Item number 5 is correct

B.

Item number 1 is correct

C.

Item number 4 is correct

D.

Item number 2 is correct

E.

Item number 3 is correct

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
On June? 30, Prince Company issues 12 %?, five?-year bonds payable with at face value of...
On June? 30, Prince Company issues 12 %?, five?-year bonds payable with at face value of $ 140 comma 000. The bonds are issued at face value and pay interest on June 30 and December 31. Requirements 1. Journalize the issuance of the bonds on June 30. 2. Journalize the semiannual interest payment on December 31. Requirement 1. Journalize the issuance of the bonds on June 30. ?(Record debits? first, then credits. Select explanations on the last line of the...
Apple Company issues $1,000,000 face value, 6%, 5-year bonds payable on December 31, 2018. Interest is...
Apple Company issues $1,000,000 face value, 6%, 5-year bonds payable on December 31, 2018. Interest is paid semiannually each June 30 and December 31. The bonds sell at a price of 97; Greece uses the straight-line method of amortizing bond discount or premium. 1) The entry made by Apple Company to record issuance of the bonds payable at December 31, 2018, includes: A- a credit to bonds payable of 970000 B_ a credit to bond interest 30000 C- A debit...
On June 30, 2020, Ayayai Company issued $4,180,000 face value of 13%, 20-year bonds at $4,494,460,...
On June 30, 2020, Ayayai Company issued $4,180,000 face value of 13%, 20-year bonds at $4,494,460, a yield of 12%. Ayayai uses the effective-interest method to amortize bond premium or discount. The bonds pay semiannual interest on June 30 and December 31. Show the proper balance sheet presentation for the liability for bonds payable on the December 31, 2021, balance sheet
On June 30, 2020, Crane Company issued $5,640,000 face value of 14%, 20-year bonds at $6,488,600,...
On June 30, 2020, Crane Company issued $5,640,000 face value of 14%, 20-year bonds at $6,488,600, a yield of 12%. Crane uses the effective-interest method to amortize bond premium or discount. The bonds pay semiannual interest on June 30 and December 31. Show the proper balance sheet presentation for the liability for bonds payable on December 31, 2021, balance sheet. (Round answers to 0 decimal places, e.g. 38,548.)
On June 30, 2010, Mackes Company issued $5,000,000 face value of 13%, 20-year bonds at $5,376,150...
On June 30, 2010, Mackes Company issued $5,000,000 face value of 13%, 20-year bonds at $5,376,150 to yield 12%. The bonds pay semiannual interest on June 30 and December 31. (a) Prepare the journal entries to record the following transactions: 1- The issuance of the bonds on June 30, 2010 2- The payment of interest and the amortization of the premium on December 31, 2010 3- The payment of interest and the amortization of the premium on June 30, 2011...
1. Discount on bonds payable and Premium on bonds payable are examples​ of: A.equity accounts. B.estimated...
1. Discount on bonds payable and Premium on bonds payable are examples​ of: A.equity accounts. B.estimated accounts. C.contraminus−accounts. D.companion accounts. 2.​$300,000 of​ 10%, 20−year bonds were sold for​ $325,000 on January 1. The bonds require semiannual interest payments on June 30 and December 31. The entry to record the June 30 interest payment on the bonds would be​ to: (Round your final answer to the nearest​ dollar.) A.debit Interest Expense​ $14,375; credit​ Cash, $14,375. B.debit Interest Expense​ $15,625; credit Premium...
On June 30, 2017, Novak Company issued $4,400,000 face value of 13%, 20-year bonds at $4,731,010,...
On June 30, 2017, Novak Company issued $4,400,000 face value of 13%, 20-year bonds at $4,731,010, a yield of 12%. Novak uses the effective-interest method to amortize bond premium or discount. The bonds pay semiannual interest on June 30 and December 31. Prepare the journal entries to record the following transactions: 1.) The issuance of bonds on June 30, 2017. 2.) The payment of interest and the amortization of the premium on December 31, 2017. 3.) The payment of interest...
On June 30, 2017, Novak Company issued $4,400,000 face value of 13%, 20-year bonds at $4,731,010,...
On June 30, 2017, Novak Company issued $4,400,000 face value of 13%, 20-year bonds at $4,731,010, a yield of 12%. Novak uses the effective-interest method to amortize bond premium or discount. The bonds pay semiannual interest on June 30 and December 31. Prepare the journal entries to record the following transactions: (1) The issuance of the bonds on June 30, 2017. (2) The payment of interest and the amortization of the premium on December 31, 2017. (3) The payment of...
On June 30, 2020, Ivanhoe Company issued $3,810,000 face value of 16%, 20-year bonds at $4,956,520,...
On June 30, 2020, Ivanhoe Company issued $3,810,000 face value of 16%, 20-year bonds at $4,956,520, a yield of 12%. Ivanhoe uses the effective-interest method to amortize bond premium or discount. The bonds pay semiannual interest on June 30 and December 31. Show the proper balance sheet presentation for the liability for bonds payable on the December 31, 2021, balance sheet. (Round answers to 0 decimal places, e.g. 38,548.) Ivanhoe Company Balance Sheet                     ...
On January 1, Year 1, McTavish Incorporated issued bonds with a face value of $500,000, a...
On January 1, Year 1, McTavish Incorporated issued bonds with a face value of $500,000, a stated rate of interest of 8%, and a 5-year term to maturity. The effective rate of interest was 10%. Interest is payable in cash on June 30 and December 31 of each year. Which of the following statements is true? This bond was issued at a premium, and each semiannual cash payment is $25,000. This bond was issued at a discount, and each semiannual...