On January 1,2016,Grimes Corporation issued $400,000 in 6%,10-year bonds payable at 104.Interest payments are due each year on December 31.Grimes uses the straight-line method of amortization on bond premium.
Required:
a)Prepare the journal entry to record issuing the bonds at a premium and the journal entry to record the first interest payment and amortization of the bond premium.
b)Assuming Grimes Corporation called the bonds at a price of $411,000 on January 1,2020,prepare the journal entry to record this transaction.

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The Answer of On January 1,2016,Grimes Corporation issued $400,000 in 6%,10-year bonds payable at 104.Interest payments are due each year on December 31.Grimes uses the straight-line method of amortization on bond premium.
Required:
a)Prepare the journal entry to record issuing the bonds at a premium and the journal entry to record the first interest payment and amortization of the bond premium.
b)Assuming Grimes Corporation called the bonds at a price of $411,000 on January 1,2020,prepare the journal entry to record this transaction.

On January 1,2016,Grimes Corporation Issued $400,000 in 6%,10-Year Bonds Payable