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Bond issued between interest dates? Accounting question?
Oriole Company issues $20300000 of 10-year, 12percent bonds on March 1, 2017 at 97 plus accrued interest. The bonds are dated January 1, 2017, and pay interest on June 30 and December 31.
Can anyone show me how to do the journal entries?
1 Answer
- Don GLv 72 years ago
On March 1:
DR Cash 20,097,000 DR Bond Discount 609,000
CR Bonds Payable 20,300,000 CR Accrued Interest 406,000
On June 30:
DR Accrued Interest 406,000 DR Interest Expense 812,000
CR Cash 1,218,000
On Dec 31:
Dr Interest Expense 1,218,000 CR Cash 1,218,000