50.1K

Verified Solution

Link Copied!

When market interest rates were 6%, three companies issued bonds on January 1, 2018. Each company has a December 31 year end and each company issued bonds with a face value of $88,000 that pay interest annually on December 31. Able Limited sold its bonds at 100 and offered a coupon interest rate of 6%, while Beta Corp. sold its bonds at 94 and offered a coupon interest rate of 4%, and Charles Inc. sold its bonds at 105 and offered a 7% coupon interest rate. Record the issue of the bonds by each company on January 1, 2018. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account Titles and Explanation Credit Debit Date Able Limited Jan. 1 88000 88000 Beta Corp. Jan. 1 Charles Inc. Jan. 1 Prepare the entry that each company would record for the payment of interest on December 31, 2018. (Round answers to 0 decimal places, e.g. 5,275. Credit account titles are automatically indented when the amount is entered. Do not indent manually) Account Titles and Explanation Debit Credit Date Able Limited Dec. 31 Beta Corp. Dec. 31 Charles Inc. Dec. 31 Determine the balance in each company's Bonds Payable account on December 31, 2018. Balance in Bonds Payable account Able Limited $ Beta Corp. Charles Inc. tA tA tA

Answer & Explanation Solved by verified expert

See Answer