Entries for bonds payable Prepare journal entries to record the following transactions relating to long-term bonds of Lancaster Inc.Show calculations and round to the nearest dollar.
a.On June 1, 2014, Lancaster Inc.issued $400,000, 6% bonds for $391,760, including
accrued interest.The bonds were dated February 1, 2014, and interest is payable semi-
annually on February 1 and August 1 with the bonds maturing on February 1, 2024.The
bonds are callable at 102.
b.On August 1, 2014, Lancaster paid the semi-annual interest and recorded the amortization
of the discount or premium, using straight-line amortization.
c.On February 1, 2016, Lancaster paid the semi-annual interest and recorded amortization of
the discount or premium.
d.The company then purchased $240,000 of the bonds at the call price.Assume that a
reversing entry was made on January 1, 2016.

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The Answer of Entries for bonds payable Prepare journal entries to record the following transactions relating to long-term bonds of Lancaster Inc.Show calculations and round to the nearest dollar.
a.On June 1, 2014, Lancaster Inc.issued $400,000, 6% bonds for $391,760, including
accrued interest.The bonds were dated February 1, 2014, and interest is payable semi-
annually on February 1 and August 1 with the bonds maturing on February 1, 2024.The
bonds are callable at 102.
b.On August 1, 2014, Lancaster paid the semi-annual interest and recorded the amortization
of the discount or premium, using straight-line amortization.
c.On February 1, 2016, Lancaster paid the semi-annual interest and recorded amortization of
the discount or premium.
d.The company then purchased $240,000 of the bonds at the call price.Assume that a
reversing entry was made on January 1, 2016.

Entries for Bonds Payable Prepare Journal Entries to Record the Following