Question

Blossom Company issued $579,000 of 9%, 10-year bonds on January 1, 2020, at face value. Interest...

Blossom Company issued $579,000 of 9%, 10-year bonds on January 1, 2020, at face value. Interest is payable annually on January 1.

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Prepare the journal entry to record the issuance of the bonds. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date

Account Titles and Explanation

Debit

Credit

Jan. 1, 2020

LINK TO TEXT

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Prepare the journal entry to record the accrual of interest on December 31, 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date

Account Titles and Explanation

Debit

Credit

Dec. 31, 2020

LINK TO TEXT

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Prepare the journal entry to record the payment of interest on January 1, 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date

Account Titles and Explanation

Debit

Credit

Jan. 1, 2021

LINK TO TEXT

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Prepare the journal entry to record the redemption of bonds at maturity, assuming interest for the last interest period has been paid and recorded. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date

Account Titles and Explanation

Debit

Credit

Jan. 1, 2027

LINK TO TEXT

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Homework Answers

Answer #1
Date Account Titles Debit Credit
Jan. 1 Cash $          579,000
2020       Bonds Payable $            579,000
(Issue of Bonds)
Dec. 31 Interest Expense $            52,110
2020        Interest Payable $              52,110
(Accrual of interest)
Jan. 1 Interest Payable $            52,110
2021         Cash $              52,110
(Payment of interest)
Jan. 1 Bonds Payable $          579,000
2027         Cash $            579,000
(Redemption of bonds)
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