Mellilo Corporation issued $6,000,000 of 20-year, 9.5 percent bonds on July 1, 2011, at 98. Interest is due on June 30 and December 31 of each year, and all of the bonds in the issue mature on June 30, 2031. Mellilo's fiscal year ends on December 31. Prepare the following journal entries:
| a. |
Prepare the journal entry at July 1, 2011, to record the issuance of the bonds. (Omit the "$" sign in your response.)
|
| Date |
General Journal |
Debit |
Credit |
| July 1, 2011 |
Cash |
|
|
|
Discount on bonds payable |
|
|
| |
Bonds payable |
|
|
| b. |
Prepare the journal entry at December 31, 2011, to pay interest and amortize the bond discount. (Omit the "$" sign in your response.)
|
| Date |
General Journal |
Debit |
credit |
| Dec. 31, 2011 |
Bond interest |
|
|
|
Discount on bonds payable |
|
|
|
Cash |
|
|
| c. |
Prepare the journal entry at June 30, 2031, to pay interest, amortize the bond discount, and retire the bonds at maturity. (Omit the "$" sign in your response.)
|
| Date |
General Journal |
Debit |
Credit |
| June 30, 2031 |
Bond interest expense |
|
|
|
Discount on bonds payable |
|
|
|
Cash |
|
|
|
|
|
|
| June 30, 2031 |
Bond Payable |
|
|
|
Cash |