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On October 1, 2019, Ball Company issued 9% bonds dated October 1, 2019, with a face amount of $200,000. The bonds mature in10 years. Interest is paid semiannually on March 31 and September 30. The proceeds from the bond issuance were $205,294.53 to yield 8.6%. Ball Company has a December 31 fiscal year-end and does not use reversing entries.                                            1. Prepare journal entries to record the issuance of the bonds and the interest payments for 2019 and 2020 using the effective interest method.                      2. Prepare journal entries to record the issuance of ' the bonds and the interest payments for 2019 and 2020 using the straight-line method.

On October 1, 2019, Ball Company issued 9% bonds dated October 1, 2019, with a face amount of $200,000. The bonds mature in10 years. Interest is paid semiannually on March 31 and September 30. The proceeds from the bond issuance were $205,294.53 to yield 8.6%. Ball Company has a December 31 fiscal year-end and does not use reversing entries.                                            1. Prepare journal entries to record the issuance of the bonds and the interest payments for 2019 and 2020 using the effective interest method.                      2. Prepare journal entries to record the issuance of ' the bonds and the interest payments for 2019 and 2020 using the straight-line method.

Principles of Accounting Volume 1
Principles of Accounting Volume 1
19th Edition
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax
Chapter13: Long-term Liabilities
Section: Chapter Questions
Problem 6PA: Aggies Inc. issued bonds with a $500,000 face value, 10% interest rate, and a 4-year term on July 1,...
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On October 1, 2019, Ball Company issued 9% bonds dated October 1, 2019, with a face amount of $200,000. The bonds mature in10 years. Interest is paid semiannually on March 31 and September 30. The proceeds from the bond issuance were $205,294.53 to yield 8.6%. Ball Company has a December 31 fiscal year-end and does not use reversing entries.                                            1. Prepare journal entries to record the issuance of the bonds and the interest payments for 2019 and 2020 using the effective interest method.                      2. Prepare journal entries to record the issuance of ' the bonds and the interest payments for 2019 and 2020 using the straight-line method. 

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