Sampson Brothers pays $55,000 into a bond sinking fund each year to redeem the future maturity of its bonds. During the first year, the fund earned $3,500. At the time of bond redemption, the fund has a balance of $550,000. Of this, $525,000 was used to redeem the bonds. Journalize the
a) initial deposit;
b) the first year's interest; and
c) the redemption of the bonds.

Question

Quizplus · Accepted Answer

The Answer of Sampson Brothers pays $55,000 into a bond sinking fund each year to redeem the future maturity of its bonds. During the first year, the fund earned $3,500. At the time of bond redemption, the fund has a balance of $550,000. Of this, $525,000 was used to redeem the bonds. Journalize the
a) initial deposit;
b) the first year's interest; and
c) the redemption of the bonds.

Sampson Brothers Pays $55,000 into a Bond Sinking Fund Each