Brief Exercise Debt Issued at Par
On January 1, 2020, Desmond & Co. issued 5,000 bonds with a SI,000 par value at 100. The bonds have an 8% stated rate, pay interest on June 30 and December 31, and mature on December 31 2020.
Required:
Prepare the journal entries to record the interest payment on June 30, 2020.
Concept introduction:
Bonds:
Bonds are debt instruments issued by the borrower company to its lenders. Bonds are issued at a specified rate of interest and for a specified time period. The bondholders get a fixed rate of interest on the bonds and repayment of the bonds at the maturity date.
To prepare:
The Journal entry to record the interest payment on June 30, 2020.
The Journal entry to record the interest payment on June 30, 2020 is explained as follows:
Journal Entries | |||
Date | Account Titles | Debit | Credit |
June... |
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