Question

The following are independent situations. 1. Marigold Corp. redeemed $132,000 face value, 13% bonds on June...

The following are independent situations.

1. Marigold Corp. redeemed $132,000 face value, 13% bonds on June 30, 2020, at 107. The carrying value of the bonds at the redemption date was $117,500. The bonds pay annual interest, and the interest payment due on June 30, 2020, has been made and recorded.
2. Cullumber Company redeemed $170,000 face value, 18% bonds on June 30, 2020, at 98. The carrying value of the bonds at the redemption date was $171,000. The bonds pay annual interest, and the interest payment due on June 30, 2020, has been made and recorded.


For each independent situation above, prepare the appropriate journal entry for the redemption or conversion of the bonds. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

No.

Date

Account Titles and Explanation

Debit

Credit

1.

 June 30

2.

 June 30
Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1
No Date Account Titles and Explanation Debit Credit
1 June 30 Bonds payable 132000
Loss on redemption of bonds 23740
      Discount on bonds payable 14500 =132000-117500
      Cash 141240 =132000*1.07
2 June 30 Bonds payable 170000
Premium on bonds payable 1000 =171000-170000
      Cash 166600 =170000*0.98
      Gain on redemption of bonds 4400
0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Carpino Corporation redeemed $500,000 of its bonds on June 30, 2020, at 101 and immediately retired...
Carpino Corporation redeemed $500,000 of its bonds on June 30, 2020, at 101 and immediately retired them. The carrying value of the bonds on the retirement date was $510,000. The bonds pay annual interest and the interest payment due on June 30, 2020, and the required entries have been made and recorded. Instructions: Record the entry to retire the bonds.
On January 1, 2020, Marigold Corp. sold 9% bonds with a face value of $2650000. The...
On January 1, 2020, Marigold Corp. sold 9% bonds with a face value of $2650000. The bonds mature in five years, and interest is paid semiannually on June 30 and December 31. The bonds were sold for $2870400 to yield 7%. Using the effective-interest method of amortization, interest expense for 2020 is
On 1 January Petal Ltd issued $98,000 9% unsecured notes at face value. Interest is payable...
On 1 January Petal Ltd issued $98,000 9% unsecured notes at face value. Interest is payable half-yearly on 1 July and 1 January. Interest is not accrued on 30 June. Petal Ltd's year-end is 31 December.    Required Prepare journal entries to record these events: (a) the issue of the unsecured notes.(b) the payment of interest on 1 July. (c) After paying interest for the year, Petal Ltd redeemed $134,000 face value, 13% debentures on 30 June 2016 at 103The...
On June 30, 2012, Skysong Company issued 12% bonds with a par value of $780,000 due...
On June 30, 2012, Skysong Company issued 12% bonds with a par value of $780,000 due in 20 years. They were issued at 97 and were callable at 105 at any date after June 30, 2020. Because of lower interest rates and a significant change in the company’s credit rating, it was decided to call the entire issue on June 30, 2021, and to issue new bonds. New 8% bonds were sold in the amount of $960,000 at 102; they...
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. Your answer is incorrect. Try again. 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 Your answer is partially correct. Try again. Prepare the journal entry to record the...
Marigold Corp. issues $25650000 face value of bonds at 95 on January 1, 2019. The bonds...
Marigold Corp. issues $25650000 face value of bonds at 95 on January 1, 2019. The bonds are dated January 1, 2019, pay interest semiannually at 8% on June 30 and December 31, and mature in 10 years. Straight-line amortization is used for discounts and premiums. On September 1, 2022, $15390000 of the bonds are called at 103 plus accrued interest. What loss would be recognized on the called bonds on September 1, 2022? $1402800 loss $1539000 loss $949050 loss $1169050...
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...
On October 1, 2021, Monty Corp. issued $828,000, 7%, 10-year bonds at face value. The bonds...
On October 1, 2021, Monty Corp. issued $828,000, 7%, 10-year bonds at face value. The bonds were dated October 1, 2021, and pay interest annually on October 1. Financial statements are prepared annually on December 31. Part 1 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 Oct. 1, 2021 enter an account title for the journal...
Notson Co. issued 12% bonds with a face value of $1,800,000 at a premium to yield...
Notson Co. issued 12% bonds with a face value of $1,800,000 at a premium to yield 10%, with interest paid on June 30 and December 31. These bonds had a carrying value of $1,872,000 on December 31, 2019. Notson uses the effective interest method of amortization. On June 30, 2020, several years before their maturity, Notson retired the bonds at 105 plus accrued interest. Direct costs associated with the bond retirement totaled $3,000. Compute: The carrying value of the bonds...
On October 1, 2021, Novak Corp. issued $840,000, 8%, 10-year bonds at face value. The bonds...
On October 1, 2021, Novak Corp. issued $840,000, 8%, 10-year bonds at face value. The bonds were dated October 1, 2021, and pay interest annually on October 1. Financial statements are prepared annually on December 31. 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 Oct. 1, 2021 enter an account title for the journal entry on...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT