Bonds Retired at Maturity
Response to the following problem:
Stottard Company issued $450,000 of 10%, 10-year bonds on June 1, 2008, at 103. The bonds were dated June 1, and interest is payable on June 1 and December 1 of each year.
Required:
1. Record the issuance of the bonds on June 1, 2008.
2. Record the interest payment on December 1, 2008. Stottard uses the straight-line method of amortization.
3. Record the interest accrual on December 31, 2008, including amortization.
4. Record the journal entries required on June 1, 2018, when the bonds mature.