On January 1, 2008, Lester Corporation issued $2,000,000, 9%, 5-year bonds dated January 1, 2008, at 96. The bonds pay semiannual interest on January 1 and July 1. The company uses the straight-line method of amortization and has a calendar year end. Instructions Prepare all the journal entries that Lester Corporation would make related to this bond issue through January 1, 2009. Be sure to indicate the date on which the entries would be made. Ex. 183 Unruh Company issued $900,000, 10%, 20-year bonds on January 1, 2008, at 104. Interest is payable semiannually on July 1 and January 1. Unruh uses the straight-line method of amortization and has a calendar year end. Instructions Prepare all journal entries made in 2008 related to the bond issue. Ex. 184 Karly Company issued $250,000, 11%, 10-year bonds on December 31, 2008, for $230,000. Interest is payable semiannually on June 30 and December 31. Karly uses the straight-line method of amortization and has a calendar year end. Instructions Prepare the appropriate journal entries on (a) December 31, 2008. (b) June 30, 2009.
COMPLETION STATEMENTS 185. Bonds that mature at a single specified future date are called bonds, whereas bonds that mature in installments are called bonds. 186. The terms of a bond issue are set forth in a formal legal document called a bond . 187. Unsecured bonds that are issued against the general credit of the borrower are called bonds. 188. If bonds were issued at a premium, then the contractual interest rate was than the market interest rate.