On June 30, 2017, Kingbird Company issued 12% bonds with a par value of $760,000...
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On June 30, 2017, Kingbird Company issued 12% bonds with a par value of $760,000 due in 20 years. They were issued at 98 and were callable at 105 at any date after June 30, 2025. Because of lower interest rates and a significant change in the companys credit rating, it was decided to call the entire issue on June 30, 2026, and to issue new bonds. New 8% bonds were sold in the amount of $920,000 at 103; they mature in 20 years. Kingbird Company uses straight-line amortization. Interest payment dates are December 31 and June 30. (a) Prepare journal entries to record the redemption of the old issue and the sale of the new issue on June 30, 2026.
No. Date Account Titles and Explanation Debit (a) (To record the redemption of the old issue) (To record the sale of the new issue) (b)
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