Question

Problem 10-09A (Part 1) Oriole Company sold $3,250,000, 9%, 10-year bonds on January 1, 2022. The bonds were dated January 1, 2022, and pay interest on January 1. The company uses straight-line amortization on bond premiums and discounts. Financial statements are prepared annually.

Prepare the journal entries to record the issuance of the bonds assuming they sold at: (1) 101 and (2) 95. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) No. Date Account Titles and Explanation Debit Credit 1. 1/1/22 enter an account title to record the issuance of the bonds assuming option one on January 1, 2017 enter a debit amount enter a credit amount enter an account title to record the issuance of the bonds assuming option one on January 1, 2017 enter a debit amount enter a credit amount enter an account title to record the issuance of the bonds assuming option one on January 1, 2017 enter a debit amount enter a credit amount 2. 1/1/22 enter an account title to record the issuance of the bonds assuming option two on January 1, 2017 enter a debit amount enter a credit amount enter an account title to record the issuance of the bonds assuming option two on January 1, 2017 enter a debit amount enter a credit amount enter an account title to record the issuance of the bonds assuming option two on January 1, 2017 enter a debit amount enter a credit amount

Prepare amortization table for issuance of the bonds sold at 101 for the first three interest payments. Annual Interest Periods Interest to Be Paid Interest Expense to Be Recorded Premium Amortization Unamortized Premium Bond Carrying Value Issue date $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount 1 enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount 2 enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount 3 enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount Prepare amortization table for issuance of the bonds sold at 95 for the first three interest payments. Annual Interest Periods Interest to Be Paid Interest Expense to Be Recorded Discount Amortization Unamortized Discount Bond Carrying Value Issue date $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount 1 enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount 2 enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount 3 enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount enter a dollar amount

List Of Accounts

Problem 10-09A

Accounts Payable Accounts Receivable Accumulated Depreciation-Equipment Accrued Pension Liability Bonds Payable Buildings Cash Common Stock Cost of Goods Sold Current Portion of Long-Term Debt Depreciation Expense Discount on Bonds Payable Dividends Equipment Federal Income Taxes Payable Federal Unemployment Taxes Payable FICA Taxes Payable Gain on Bond Redemption Income Tax Expense Income Taxes Payable Insurance Expense Interest Expense Interest Payable Inventory Land Loss on Bond Redemption Mortgage Payable No Entry Notes Payable Other Operating Expenses Payroll Tax Expense Premium on Bonds Payable Prepaid Insurance Property Taxes Payable Retained Earnings Salaries and Wages Expense Salaries and Wages Payable Sales Revenue Sales Taxes Payable Service Revenue Share Premium-Conversion Equity State Income Taxes Payable State Unemployment Taxes Payable Subscription Revenue Ticket Revenue Unearned Rent Revenue Unearned Sales Revenue Unearned Service Revenue Unearned Subscription Revenue Unearned Ticket Revenue Union Dues Payable Warranty Liability

Answer 1

Date January 1st 22 Issue Entry 1. Record the Bond Issue with Premium General Journal Debit Cash (3250000*1.01) Premium on Bonds Payable Bonds Payable Record the Issue of the Bond with Premium Credit 3282500 32500 3250000 Date January 1st 22 1. Record the Bond Issue with Discount General Journal Debit Cash (3250000*0.95) Discount on Bonds Payable Bonds Payable Record the issue of the Bond with Discount Credit 3087500 162500 3250000

Amortization Sechedule Interest to Interst Premium Unamortized | Period be paid Expenses Amortized | Premium Issue 01 32500 292500 289250 3250 29250 2 292500 289250 3250 26000 292500 289250 3250 22750 Interest to be paid (3250000*9%) 292500 Interst Expenses (292500-(32500/10) 289250 Carrying Value 3282500 3279250 3276000 3272750 3 Amortization Sechedule Interest to Interst Disocunt Period be paid Expenses Amortized Issue 0 0 292500 308750 16250 292500 308750 16250 3 292500 292 308750 16250 Interest to be paid 250000*9%) 292500 Interst Expenses (292500+(162500/10) 308750 Unamortized | Discount 162500 146250 130000 113750 Carrying Value 3087500 3103750 3120000 3136250