Malay Corporation issued $2 million, 10-year, 6% bonds on January 1, 2017. Prepa

Question

Malay Corporation issued $2 million, 10-year, 6% bonds on January 1, 2017. Prepare the entry to record the sale of these bonds, assuming they were issued at 98. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit SHOW LIST OF ACCOUNTS Prepare the entry to record the sale of these bonds, assuming they were issued at 103. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit Click if you would like to Show Work for this question: Open Show Work

Explanation / Answer

General Journal Debit Credit (a) Cash ($2,000,000 × 98%) $1,960,000 Discount on Bonds Payable $40,000 Bonds Payable $2,000,000 (b) Cash ($2,000,000 × 103%) $2,060,000 Bonds Payable $2,000,000 Premium on Bonds Payable $60,000

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