Brief Exercise 10-10 Indigo Corporation issued 3,000 896, 6-year, $1,000 bonds d

Question

Brief Exercise 10-10 Indigo Corporation issued 3,000 896, 6-year, $1,000 bonds dated January 1, 2017, at face value. Interest is paid each January 1. (a) Prepare the journal entry to record the sale of these bonds on January 1, 2017. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Jan. 1,2017 Account Titles and Explanation Debit Credit (b) Prepare the adjusting journal entry on December 31, 2017, to record interest expense. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Dec. 31, 2017 Account Titles and Explanation Debit Credit (c) Prepare the journal entry on January 1, 2018, to record interest paid. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Jan. 1, 2018 Account Titles and Explanation Debit Credit SHOW LIST OF ACCOUNTS LINK TO TEXT INTERACTIVE TUTORIAL Question Attempts: 0 of 3 used SAVE FOR LATER SUBHIT ANSWER

Explanation / Answer

Jan-1-17 Cash 3000000 =3000*1000       Bonds payable 3000000 Dec-31-17 Interest expense 240000 =3000000*8%       Interest payable 240000 Jan-1-18 Interest payable 240000        Cash 240000

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