Question
On 31 July 2019, Carmody Ltd issues $600,000 of 5%, 5-year debentures at par. The interest...
On 31 July 2019, Carmody Ltd issues $600,000 of 5%, 5-year debentures at par. The interest payment dates are 31 May and 30 November. Carmody Ltd incurs interest expenses from these Debentures only and its financial year ends on 31 December.
Required:
(A) Journalise the issue of debentures on 31 July 2019.
(B) Journalise the payment of interest on 30 November 2019.
(C) Journalise the accrual of interest (if any) on 31 December
2019.
(D) Journalise the payment of interest on 31 May 2020.
(E) Report Debentures payable and Interest payable as they would
appear on the statement of financial position at 31 December
2019.
(F) Report Interest expenses as they would appear on the statement
of profit and loss for the fiscal year 2019.
Note that narrations are not required for journal entries.
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