On April 1, 2016, Quicke Mart issued $1,000,000, 9% bonds at par plus accrued interest dated January 1, 2014. Interest is payable semi-annually on January 1 and July 1. The bonds mature on January 1, 2023.
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Requirements
Prepare journal entries to record the following transactions related to long-term bonds of Quicke Mart:
1) The issuance of the bonds.2) The first interest payments.
What will be an ideal response?
?
| 1) | Cash | 1,022,500 | ? | |
| ? | ? | Bonds Payable | ? | 1,000,000 |
| ? | ? | Interest Payable ($1,000,000´9%´3/12) | ? | 22,500 |
| ? | ? | ? | ? | ? |
| 2) | Interest Expense ($1,000,000 × 9% × 3/12) | 22,500 | ? | |
| ? | Interest Payable | 22,500 | ? | |
| ? | ? | Cash | ? | 45,000 |
Business
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