Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. sarasota company issued $2,320,000,9%, 20-year bon

Sarasota Company issued $2,320,000,9%, 20-year bonds on January 1, 2020, at 103. Interest is payable...

80.2K

Verified Solution

Question

Accounting

image

Sarasota Company issued $2,320,000,9%, 20-year bonds on January 1, 2020, at 103. Interest is payable annually on January 1. Sarasota uses straight-line amortization for bond premium or discount. Prepare the journal entries to record the following events. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) (a) (b) The issuance of the bonds. The accrual of interest and the premium amortization on December 31, 2020. The payment of interest on January 1, 2021. The redemption of the bonds at maturity, assuming interest for the last interest period has been paid and recorded. (c) (d) Date Account Titles and Explanation Debit Credit 21, 2020 Cash 2389600 Premium on Bonds Payable 69600 Bonds Payable 2320000 31, 2020 Interest Expense 203000 Premium on Bonds Payable 5800 Interest Payable 208800 21, 2021 Interest Payable 208800 Cash 208800 21, 2040 Bonds Payable 2320000 Cash 2320000

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students