On the first day of the fiscal year, a company issues a $7,200,000, 10%, 7-year bond that pays semiannual interest of $360,000 ($7,200,000 x 10% x ½), receiving cash of $7,568,023. Journalize the first interest payment and the amortization of the related bond premium. Round to the nearest dollar. If an amount box does not require an entry, leave it blank. Interest Expense v 368,023 Premium on Bonds Payable v 26,287 Cash / 360,000

On the first day of the fiscal year, a company issues a $7,200,000, 10%, 7-year bond that pays semiannual interest of $360,000 ($7,200,000 x 10% x ½), receiving cash of $7,568,023. Journalize the first interest payment and the amortization of the related bond premium. Round to the nearest dollar. If an amount box does not require an entry, leave it blank. Interest Expense v 368,023 Premium on Bonds Payable v 26,287 Cash / 360,000

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 8MC: On October 1 a company sells a 3-year, $2,500,000 bond with an 8% stated interest rate. Interest is...

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