ZillowZillow Corp. issued 66?% tenten?-year bonds payable with a face amount of
ID: 2528569 • Letter: Z
Question
ZillowZillow
Corp. issued
66?%
tenten?-year
bonds payable with a face amount of
$ 120 comma 000$120,000
when the market interest rate was
66?%.
Assume that the accounting year of
ZillowZillow
ends on December 31 and that bonds pay interest on January 1 and July 1. Journalize the following transactions for
ZillowZillow.
Include an explanation for each entry. ?(Record debits? first, then credits. Select the explanation on the last line of the journal entry? table.)
a.
Issuance of the bonds payable at par on July? 1, 20162016
b.
20162016
c.
Payment of cash interest on January? 1, 20172017
d.
Payment of the bonds payable at maturity? (give the? date)
a. Is Issuance of the bonds payable at par on July? 1, 20162016
ZillowZillow
Corp. issued
66?%
tenten?-year
bonds payable with a face amount of
$ 120 comma 000$120,000
when the market interest rate was
66?%.
Assume that the accounting year of
ZillowZillow
ends on December 31 and that bonds pay interest on January 1 and July 1. Journalize the following transactions for
ZillowZillow.
Include an explanation for each entry. ?(Record debits? first, then credits. Select the explanation on the last line of the journal entry? table.)
a.
Issuance of the bonds payable at par on July? 1, 20162016
b.
Accrual of interest expense on December? 31,20162016
?(rounded to the nearest? dollar)c.
Payment of cash interest on January? 1, 20172017
d.
Payment of the bonds payable at maturity? (give the? date)
a. Is Issuance of the bonds payable at par on July? 1, 20162016
Explanation / Answer
a 01-Jul-16 Cash 120000 Bonds payable 120000 b 31-Dec-16 Interest expense 3600 (120000*6%*6/12) Interest payable 3600 c 01-Jan-17 Interest payable 3600 Cash 3600 d 30-Jun-26 Bonds payable 120000 Cash 120000
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