This Is Question 1halloway Company Has Issued Three Different Bonds D 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 value. 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.
Paper For Above instruction The issuance and redemption of bonds are fundamental activities in corporate finance, impacting a company's capital structure and financial statements. This paper discusses these processes with specific reference to Halloway Company’s bond issues in 2011 and Lemay Company’s bond redemption in July 2011, illustrating key accounting entries and principles involved. **Bond Issuance Transactions** In 2011, Halloway Company issued three different bonds, each with distinct terms and issuance conditions. The first issuance involved bonds issued at face value, the second at a premium, and the third at a discount. Understanding how to record these transactions requires knowledge of bond accounting principles, notably how to handle issuance at face, premium, and discount. 1. The first bond issue on January 1, 2011, involved 1,000 bonds with an 8% interest rate, maturing in five years, and issued at face value. The journal entry on January 1, 2011, records the cash received and the bonds payable: ```plaintext Debit: Cash $1,000,000 Credit: Bonds Payable $1,000,000 ```