woodwick Company issues 8% five-year bonds, on December 31, 2016, with a panaue

Question

woodwick Company issues 8% five-year bonds, on December 31, 2016, with a panaue of S97000 and semiannual merest payments 2 )12/31/2016 1) 6/3/2917 (2) 12/31/2017 58,e52 7.246 6,442 385,851 4,246 3,442 Use the above straight -line bond amortization table and prepare journal entries for the following (aj) The issuance of bonds on December 31, 2016 b) The first interest payment on June 30, 2017 c) The second interest payment on December 31, 2017 Journal entry worksheet Record the isse of bonds with a par value of $97,000 ash on December ? 2016. Dec 31 2016

Explanation / Answer

Journal entries :

Date General journal debit credit Dec 31,2016 Cash 105051 Bonds payable 97000 Premium on bonds payable 8051 (TO record issue bonds payable) June 30,2017 Interest expense 3075 Premium on bonds payable (8051/10) 805 Cash (97000*8%*6/12) 3880 (To record interest) Dec 31,2017 Interest expense 3075 Premium on bonds payable 805 Cash 3880 (To record interest)

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