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Hillside issues $2,700,000 of 7%, 15-year bonds dated January 1, 2019, that pay interest semiannually on June 30 and December 31. The bonds are issued at a price of $3,304,790.

Required:
Prepare the January 1, 2019, journal entry to record the bonds’ issuance.

Respuesta :

Answer: Dr Cash $3,304,790

Cr Bonds payable $2,700,000

Cr Premium on bond issued $604,790

Explanation:

The journal entry to record the bonds’ issuance will be illustrated below:

January 1, 2019

Debit Cash $3,304,790

Credit Bonds payable $2,700,000

Credit Premium on bond issued $604,790

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