accounting 291

This is question 1)


Halloway Company has issued three different bonds during 2011. Interest is payable

semiannually on each of these bonds.


1. On January 1, 2011, 1,000, 8%, 5-year, $1,000 bonds dated January 1, 2011, were issued at face



2. On July 1, $800,000, 9%, 5-year bonds dated July 1, 2011, were issued at 102.

3. On September 1, $200,000, 7%, 5-year bonds dated September 1, 2011, were issued at 98.

Prepare the journal entry to record each bond transaction at the date of issuance.

This is question 2)

The balance sheet for Lemay Company reports the following information on July 1,2011.


Long-term liabilities


Bonds payable $1,000,000


Less: Discount on bonds payable 60,000 $940,000


Lemay decides to redeem these bonds at 101 after paying semiannual interest. Prepare the journal


entry to record the redemption on July 1, 2011.












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