Question

On the first day of its fiscal year, Chin Company issued $10,800,000 of five-year, 11% bonds to finance its operations of producing and selling home improvement products. Interest is payable semiannually. The bonds were issued at a market (effective) interest rate of 12%, resulting in Chin Company receiving cash of $10,402,505. a. Journalize the entries to record the following: Issuance of the bonds. First semiannual interest payment. The bond discount amortization, using the straight-line method, is combined with the semiannual interest payment. (Round your answer to the nearest dollar.) Second semiannual interest payment. The bond discount amortization, using the straight-line method, is combined with the semiannual interest payment. (Round your answer to the nearest dollar.) For a compound transaction, if an amount box does not require an entry, leave it blank. Round your answers to the nearest dollar.

Answer #1

**Solution:**

Chin Company | |||

Journal Entries | |||

Event | Particulars | Debit | Credit |

1 | Cash Dr | $10,402,505.00 | |

Discount on issue of bond Dr | $397,495.00 | ||

To Bond Payable | $10,800,000.00 | ||

(To record issue of bond) | |||

2 | Interest expense Dr | $633,750.00 | |

To Cash ($10,800,000*11%*6/12) | $594,000.00 | ||

To Discount on issue of bond ($397,495/10) | $39,750.00 | ||

(To record first semiannual interest payment and discount amortization) | |||

3 | Interest expense Dr | $633,750.00 | |

To Cash ($10,800,000*11%*6/12) | $594,000.00 | ||

To Discount on issue of bond ($397,495/10) | $39,750.00 | ||

(To record 2nd semiannual interest payment and discount amortization) |

On the first day of its fiscal year, Chin Company issued
$21,000,000 of five-year, 8% bonds to finance its operations of
producing and selling home improvement products. Interest is
payable semiannually. The bonds were issued at a market (effective)
interest rate of 10%, resulting in Chin Company receiving cash of
$19,378,363.
Part A: Journalize the entries to
record the following:
Issuance of the bonds.
First semiannual interest payment. The bond discount
amortization, using the straight-line method, is combined with the
semiannual...

On the first day of its fiscal year, Chin Company issued
$24,400,000 of five-year, 4% bonds to finance its operations of
producing and selling home improvement products. Interest is
payable semiannually. The bonds were issued at a market (effective)
interest rate of 6%, resulting in Chin receiving cash of
$22,318,534.
a. Journalize the entries to record the
following:
Issuance of the bonds.
b. Determine the amount of the bond interest
expense for the first year.
$First semiannual interest payment. The...

On the first day of its fiscal year, Chin Company issued
$24,400,000 of five-year, 4% bonds to finance its operations of
producing and selling home improvement products. Interest is
payable semiannually. The bonds were issued at a market (effective)
interest rate of 6%, resulting in Chin receiving cash of
$22,318,534.
a. Journalize the entries to record the
following:
Issuance of the bonds.
First semiannual interest payment. The bond discount is combined
with the semiannual interest payment. (Round your answer to...

Entries for Issuing Bonds and Amortizing Discount by
Straight-Line Method On the first day of its fiscal year, Chin
Company issued $16,500,000 of five-year, 10% bonds to finance its
operations of producing and selling home improvement products.
Interest is payable semiannually. The bonds were issued at a market
(effective) interest rate of 12%, resulting in Chin Company
receiving cash of $15,285,509. a. Journalize the entries to record
the following: Issuance of the bonds. First semiannual interest
payment. The bond discount...

Entries for Issuing Bonds and Amortizing Discount by
Straight-Line Method
On the first day of its fiscal year, Chin Company issued
$16,200,000 of five-year, 7% bonds to finance its operations of
producing and selling home improvement products. Interest is
payable semiannually. The bonds were issued at a market (effective)
interest rate of 9%, resulting in Chin Company receiving cash of
$14,918,178.
a. Journalize the entries to record the
following:
Issuance of the bonds.
First semiannual interest payment. The bond discount...

Entries for Issuing Bonds and Amortizing Discount by
Straight-Line Method
On the first day of its fiscal year, Chin Company issued
$13,800,000 of five-year, 4% bonds to finance its operations of
producing and selling home improvement products. Interest is
payable semiannually. The bonds were issued at a market (effective)
interest rate of 6%, resulting in Chin Company receiving cash of
$12,622,777.
a. Journalize the entries to record the
following:
Issuance of the bonds.
First semiannual interest payment. The bond discount...

Entries for Issuing Bonds and Amortizing Discount by
Straight-Line Method On the first day of its fiscal year, Chin
Company issued $15,300,000 of five-year, 10% bonds to finance its
operations of producing and selling home improvement products.
Interest is payable semiannually. The bonds were issued at a market
(effective) interest rate of 11%, resulting in Chin Company
receiving cash of $14,723,366.
a. Journalize the entries to record the following:
1. Issuance of the bonds.
2. First semiannual interest payment. The...

Entries for Issuing Bonds and Amortizing Discount by
Straight-Line Method On the first day of its fiscal year, Chin
Company issued $19,500,000 of five-year, 9% bonds to finance its
operations of producing and selling home improvement products.
Interest is payable semiannually. The bonds were issued at a market
(effective) interest rate of 11%, resulting in Chin Company
receiving cash of $18,030,155. a. Journalize the entries to record
the following: Issuance of the bonds. First semiannual interest
payment. The bond discount...

Entries for Issuing Bonds and Amortizing Discount by
Straight-Line Method
On the first day of its fiscal year, Chin Company issued
$27,400,000 of five-year, 12% bonds to finance its operations of
producing and selling home improvement products. Interest is
payable semiannually. The bonds were issued at a market (effective)
interest rate of 14%, resulting in Chin receiving cash of
$25,475,556.
a. Journalize the entries to record the
following:
Issuance of the bonds.
First semiannual interest payment. The bond discount is...

Entries for Issuing Bonds and Amortizing Discount by
Straight-Line Method
On the first day of its fiscal year, Chin Company issued
$26,300,000 of five-year, 11% bonds to finance its operations of
producing and selling home improvement products. Interest is
payable semiannually. The bonds were issued at a market (effective)
interest rate of 12%, resulting in Chin receiving cash of
$25,332,027.
a. Journalize the entries to record the following:
Issuance of the bonds.
First semiannual interest payment. The bond discount is...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 1 minute ago

asked 3 minutes ago

asked 7 minutes ago

asked 7 minutes ago

asked 7 minutes ago

asked 8 minutes ago

asked 9 minutes ago

asked 9 minutes ago

asked 12 minutes ago

asked 15 minutes ago

asked 17 minutes ago

asked 17 minutes ago