On January 1, 2018 Ripstick Park issues $720,000 of 8% bonds, due ?n en years, w

Question

On January 1, 2018 Ripstick Park issues $720,000 of 8% bonds, due ?n en years, with interest payable semiannually on June 30 and December 31 each year. Assuming the market interest ate on the issue date is 9% the bonds will issue at $673.172 1. Complete the first three rows of an amortization table through December 31, 2018. (Round your answers to the nearest dollar amount. Enter all amounts as positive valucs.) Value Carrying Valu Date 01 01/2018 De/302018 12 31/2018 Cash Paid 2. Record the bond issue on January 1, 2018, and the first two semi-annual interest payments on June 30, 2018, and Deoember 31, 2018. (If no entry is required for a transactionlevent, select "No journal entry required" in the first account field. Round your answers to the nearest dollar amount.) View transaction list Journal entry worksheet Record the bond issue onJanuary 1, 2018 Note: Enter debits before cnedits.

Explanation / Answer

Amortization Table Date Cash interest increase in Carrying paid expense CV value 4% 4.50% 1/1/2018 673,172 6/30/2018 28,800 30293 1493 674665 12/31/2018 28,800 30360 1560 676225 720,000*4%= 28800 Journal Entrye Date Account titles & Explanations Debit Credit 1/1/2018 Cash 673,172 discount on bonds payable 46,828 Bonds payable 720,000 6/30/2018 interest expense 30293 Discount on bonds 1493 cash 28,800 12/31/2018 interest expense 30360 Discount on bonds 1560 cash 28,800

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