Peplum Show Company issued $600,000 of 10%, 20-year bonds on January 1, 2018 at 102.Interest is payable semi-annually on July 1 and January 1. Peplum Show company useseffective-interest method for amortization of bon discount or premium as the case may be.Assuming effective yield of 9.7705%, prepare journal entry for payment of interest andrelated amortization on July 1, 2018.DateAccount Detail & ExplanationDebitCredit| 1/7/2018 Interest Expense$30,000$102Premium on bonds payableCash$30,102|а.DateAccount Detail & ExplanationDebitCredit|1/7/2018 Interest Expense$60,000$102Premium on bonds payableb.Cash$60,102|DateAccount Detail & ExplanationDebitCredit| 1/7/2018 Interest Expense$29,898|$102Premium on bonds payableCash$30,000с.DateAccount Detail & ExplanationDebitCredit| 1/7/2018 Interest Expense$29,312Premium on bonds payable$102|d.Cash$29,414|

A journal entry is used to record day-to-day transactions of the business by debiting and crediting…

Peplum Show Company issued $600,000 of 10%, 20-year bonds on January 1, 2018 at 102. Interest is payable semi-annually on July 1 and January 1. Peplum Show company uses effective-interest method for amortization of bon discount or premium as the case may be. Assuming effective yield of 9.7705%, prepare journal entry for payment of interest and related amortization on July 1, 2018.

Peplum Show Company issued $600,000 of 10%, 20-year bonds on January 1, 2018 at 102. Interest is payable semi-annually on July 1 and January 1. Peplum Show company uses effective-interest method for amortization of bon discount or premium as the case may be. Assuming effective yield of 9.7705%, prepare journal entry for payment of interest and related amortization on July 1, 2018.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter13: Long-term Liabilities

Section: Chapter Questions

Problem 14MC: Whirlie Inc. issued $300,000 face value, 10% paid annually, 10-year bonds for $319,251 when the...

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