ACME Distribution December 31, 2016 Adjusting Entries Continued 6) The company i

Question

ACME Distribution December 31, 2016 Adjusting Entries Continued 6) The company issued a $75,000 bond dated August 1, 2016 to finance the purchase of warehouse equipment and provide the company additional cash. The bond has a contractual interest rate of 6.7% and was issued at par. The bond matures in 10 years and pays interest on July 31 and January 31 each year. What is the amount of interest to be accrued at December 31, 2016? (Round answer to nearest dollar and show your calculation below for full credit) Complete below the adjusting journal entry necessary for accrued interest: Account description Credit Post the above entry to the trial balance in the adjustment columns.

Explanation / Answer

6 Interest accrued = 75000*6.7%/12*5= $2094 Debit Credit Interest expense 2094          Interest payable 2094

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.