Assignment:
BONDS ISSUED AT FACE VALUE Ito Co. issued the following bonds:
Date of issue and sale: ....................April 1, 20-1
Principal amount: ..........................$300,000
Sale price of bonds: .......................100
Denomination of bonds: ..................$5,000
Life of bonds: ..............................5 years
Stated rate: .................................10%, payable semiannually on
................................................September 30 and March 31
REQUIRED
Q: Prepare journal entries for:
(a) Issuance of the bonds.
(b) Interest payment on the bonds on September 30, 20-1.
(c) Year-end adjustment on the bonds for 20-1.
(d) Reversing entry for the beginning of 20-2.
(e) Interest payments on the bonds for 20-2 (March 31 and September 30).
(f) Redemption at maturity.