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David raised working capital from local investors by issuing bonds. The bonds, which have a face...

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Accounting

  1. David raised working capital from local investors by issuingbonds. The bonds, which have a face value of $40,000, were sold onJuly 1st, 2018. They have a coupon rate of 7.40 percent and payinterest monthly for three years with the first payment due onAugust 1st, 2018. The last payment, which includes repayment ofprincipal, is July 1st, 2021. David’s investors agreed on an issueprice of 106.

Required: Prepare journal entries to record alltransactions and adjustments for the year ending December 31, 2018(record all of the entries in a single sheet).

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Journal Entries for the year ending December 31 2018 July 1 2018 Bank ac Dr 40000 To Bonds Liability ac 40000 Being amount raised by issue of bonds Aug 1 2018 Interest on Bonds 247 To    See Answer
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