On 31 December 20X7, a company has the following bond on thestatement of financial position:
| | |
Bond payable, 7%, interest due semi-annually on 31Dec.
and 30 June;maturity date, 30 June 20X11 | $ | 8,200,000 |
| Premium on bonds payable | | 68,880 |
| | |
| $ | 8,268,880 |
| | |
|
On 28 February 20X8, 20% of the bond was retired for $1,804,000plus accrued interest to 28 February. Interest was paid on thisdate only for the portion of the bonds that were retired. Premiumamortization was recorded on this date in the amount of $660,representing amortization on the retired debt only.
Required:
Provide the entries to record the bond interest on 28 Februaryand the bond retirement. (If no entry is required for atransaction/event, select "No journal entry required" in the firstaccount field. Do not round intermediate calculations. Round youranswers to the nearest whole dollar amount.)
- Record the entry to update interest expense andamortization.
- Record the entry to retire bonds.
