You are an accounting intern working for SpringFit Corporation. You have recentl
ID: 2529293 • Letter: Y
Question
You are an accounting intern working for SpringFit Corporation. You have recently been assigned to help one of the accountants who is doing an internal audit of the business. You will be assisting with a review of the payables issued by SpringFit Corporation. Your first task is to review the previous year’s journal entries, shown as follows:
Journal Entries, Year 1
PAGE 15
GENERAL JOURNAL
ACCOUNTING EQUATION
1
Jan. 1
Cash
1,062,060.00
?
2
Premium on Bonds Payable
62,060.00
?
3
Bonds Payable
1,000,000.00
?
4
Jun. 30
Interest Expense
19,397.00
?
5
Premium on Bonds Payable
3,103.00
?
6
Cash
22,500.00
?
7
Jul. 1
Cash
1,921,280.00
?
8
Discount on Bonds Payable
78,720.00
?
9
Bonds Payable
2,000,000.00
?
10
Dec. 31
Interest Expense
19,397.00
?
11
Premium on Bonds Payable
3,103.00
?
12
Cash
22,500.00
?
13
31
Interest Expense
41,560.00
?
14
Discount on Bonds Payable
6,560.00
?
15
Cash
35,000.00
?
16
31
Income Summary
80,354.00
?
17
Interest Expense
80,354.00
Review the journal entries on the SpringFit Corporation panel, then answer the following questions.
DATE ACCOUNT TITLE POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY1
Jan. 1
Cash
1,062,060.00
?
2
Premium on Bonds Payable
62,060.00
?
3
Bonds Payable
1,000,000.00
?
4
Jun. 30
Interest Expense
19,397.00
?
5
Premium on Bonds Payable
3,103.00
?
6
Cash
22,500.00
?
7
Jul. 1
Cash
1,921,280.00
?
8
Discount on Bonds Payable
78,720.00
?
9
Bonds Payable
2,000,000.00
?
10
Dec. 31
Interest Expense
19,397.00
?
11
Premium on Bonds Payable
3,103.00
?
12
Cash
22,500.00
?
13
31
Interest Expense
41,560.00
?
14
Discount on Bonds Payable
6,560.00
?
15
Cash
35,000.00
?
16
31
Income Summary
80,354.00
?
17
Interest Expense
80,354.00
Explanation / Answer
Requirement 3 The Interest paid during the year is in question 2 $35000 Note : Assumption here is interest paid implies actual cash interest paid and not the interest expense However, If question mean the interest expense, the answer will be $41560 Requirement 4 The carrying amount of Bonds in question 2 at the end of the year is $1927840 Bonds payable 2000000 Less : Unamortized Discount 72160 1927840 (78720-6560) Requirement 8 The carrying value of bonds in question 5 is $1055854 Bonds Payable 1000000 Add : unamortized premium 55854 1055854 (62060-3103-3103) Your all other answers written after the questions are correct.
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.