ACC 291 Week 3 Assignment
P10-3A On May 1, 2011, Newby Corp. issued $600,000, 9%, 5-year
bonds at...

Question

ACC 291 Week 3 Assignment
P10-3A On May 1, 2011, Newby Corp. issued $600,000, 9%, 5-year 
bonds at face value. The bonds were dated May 1, 2011, and pay interest 
semiannually on May 1 and November 1. Financial statements are prepared 
annually on December 31.
Instructions
a) Prepare the journal entry to record the issuance of the bonds
b) Prepare the adjusting entry to record the accrual of interest on December 31, 2011
c) Show the balance sheet presentation on December 31, 2011.
d) Prepare the journal entry to record payment of interest of May 1,
 2012, assuming no accrual of interest from January 1, 2012 to May 1, 
2012.
e) Prepare the journal entry to record payment of interest on November 1, 2012
f) Assume that on November 1, 2012, Newby calls the bonds at 102. record the redemption of the bonds.

David · Accepted Answer

On May 1, 2011, Newby Corp
On May 1, 2011, Newby Corp. issued $600,000, 9%, 5-year bonds at face value. The bonds were dated May 1, 2011 and pay interest semiannually on May 1 and November 1. Financial statements are prepared annually on December 31. Instructions a) Prepare the journal entry to record the issuance of the bonds b) Prepare the adjusting entry to record the accrual of interest on December 31, 2011 c) Show the balance sheet presentation on December 31, 2011. d) Prepare the journal entry to record payment of interest of May 1, 2012, assuming no accrual of interest from January 1, 2012 to May 1, 2012. e) Prepare the journal entry to record payment of interest on November 1, 2012 f) Assume that on November 1, 2012, Newby calls the bonds at 102. Record the redemption of the bonds?
Ans.
a) journal for the issuance of bond:

ACC 291 Week 3 Assignment P10-3A On May 1, 2011, Newby Corp. issued $600,000, 9%, 5-year bonds at face value. The bonds were dated May 1, 2011, and pay interest semiannually on May 1 and November 1....

Solution

Answer To This Question Is Available To Download

Related Questions & Answers

Submit New Assignment