On October 1, 2016, Ball Company issued 10% bonds dated October 1, 2016, with a...
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Accounting
On October 1, 2016, Ball Company issued 10% bonds dated October 1, 2016, with a face amount of $350,000. The bonds mature in 8 years. Interest is paid semiannually on March 31 and September 30. The proceeds from the bond issuance were $355,751.07 to yield 9.70%. Ball Company has a December 31 fiscal year-end and does not use reversing entries.
Required:
| 1. | Prepare journal entries to record the issuance of the bonds and the interest payments for 2016 and 2017 using the effective interest method. |
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