Problem
Kershaw Electric sold $5,285,000, 13%, 10-year bonds on January 1, 2017. The bonds were dated January 1, 2017, and paid interest on January 1. The bonds were sold at 95. A-Prepare the journal entry to record the issuance of the bonds on January 1, 2017. B-At December 31, 2017, $7,700 of the Discount on Bonds Payable account has been amortized. Show the balance sheet presentation of the long-term liability at December 31, 2017. C-On January 1, 2019, when the carrying value of the bonds was $5,036,150, the company redeemed the bonds at 101. Record the redemption of the bonds assuming that interest for the period has already been paid.