00:01
On january 1st, boston enterprises issues bonds that have a 3 ,400 ,000 par value, mature in 20 years, and pay 9 % interest semi -annually on june 30th and december 31st.
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The bonds are sold at par.
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Number one, how much interest will boston pay in cash to the bondholders every six months? two, prepare journal entries to record a, the issuance of bonds on january 1st, b, the first interest payment on june 30th, and, and see the second interest payment on december 31st.
00:34
Three, prepare the journal entry for issuance assuming the bonds are issued at a .98 and b, 102.
00:42
So, number one, boston enterprises will pay interest every six months of $3 ,400 ,000 times 9 % times six months out of 12 months of the year for a total of $100 ,000.
01:20
$153 ,000.
01:26
Part two, we're going to write our journal entry.
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So we're going to have our account title, our debit column, and our credit column.
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Cash, we are going to debit that $3 ,400 ,000.
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We are going to credit bonds payable, $3 ,400 ,000.
02:12
We are going to debit interest expense, $153 ,000...