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Bramble Corp has issued three different bonds during 2022
Bramble Corp has issued three different bonds during 2022. Interestis payable annually on each of these bonds, 1. 2. 30 On January 1, 2022,1.4007 Sew. 51.oboods dated January 1, 2022 wereladatlace value Onlily 1.794.000 8 Year bonds dated July 1 2022. weat101 On September... year bonds dated September 1, 2022 were issued at
Bramble Corp. has issued three different bonds during 2022. Interest is payable annually on each of these bonds. 1. 2. On January 1,2022,1.400,7%, 5-year $1.000bonds dated January 1, 2022 were issued at face value On July 1.5794,000,8%, 5-year bonds dated July 1, 2022. were issued at 101. On September 1,$360,000,6%, 5-year bonds dated September 1, 2022 were issued at97. 3. Prepare the journal entry to record each bond transaction at the date of issuance. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) No. Date Account Titles and Explanation Debit Credit 1. Jan. 1 2 . July 1 3. Sept.
Expert Solution
Answer:-
| Date | Particulars | Debit | Credit |
| 1). Jan 1 | Cash | $1,400,000 | |
| Bonds payable | $1,400,000 | ||
| (To record the bond issued at fair value) | |||
| 2). Jul 1 | Cash | $801,940 | |
| Bond payable | $790,000 | ||
| Premium on bonds payable ( Balance figure ) | $7,940 | ||
| (To record the bonds issued with premium ) | |||
| 3). Sep 1 | Cash | $349,200 | |
| Discount on bonds payable | $10,800 | ||
| Bonds payable | $360,000 | ||
| (To record the bonds issued at discount ) |
Working note:-
1). Bonds payable = 1,400*$1,000 = $1,400,000
2). Cash = $794,000*101/100) = $801,940
3). Cash = $360,000*97/100 = $349,200
Discount = $360,000 - $349,200 = $10,800
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