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On January 1, 2017, Candlestick, Inc. sells $100,000, five-year, 10 % bonds for 92.639% of face...

On January 1, 2017, Candlestick, Inc. sells $100,000, five-year, 10 % bonds for 92.639% of face value. On the other hand the same company sells 108.111% of face value on July 1, 2017. Pass the necessary journal entry for issuance of bonds.

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Answer #1
Date Account titles and explanation Debit Credit
January 1, 2017 Cash $     92,639
Discount on Bonds Payable $       7,361
Bonds Payable $       1,00,000
(To record issuance of bonds payable)
July 1, 2017 Cash $ 1,08,111
Bonds Payable $       1,00,000
Premium on Bonds Payable $             8,111
(To record issuance of bonds)
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