On January 1, 2021, Focus Corporation issued $600,000, 6%, 5-year bonds at face value. Interest is payable annually on January 1. Prepare journal entries to record the (a) Issuance of the bonds. (b) Accrual of interest on December 31. (c) Payment of interest on January 1, 2022.

On January 1, 2021, Focus Corporation issued $600,000, 6%, 5-year bonds at face value. Interest is payable annually on January 1. Prepare journal entries to record the (a) Issuance of the bonds. (b) Accrual of interest on December 31. (c) Payment of interest on January 1, 2022.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable

Section: Chapter Questions

Problem 8RE

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Question

On January 1, 2021, Focus Corporation issued $600,000, 6%, 5-year bonds at face value. Interest is payable annually on January 1. Prepare journal entries to record the

(a)		Issuance of the bonds.
(b)		Accrual of interest on December 31.
(c)		Payment of interest on January 1, 2022.

Definition Definition Method of recording financial transactions in the book of original entry by debiting and crediting the accounts affected by a transaction using the golden rules of accrual accounting.

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