Elkins Company sold $2,500,000, 8%, 10-year bonds on July 1, 2011. The bonds were dated July 1, 2011, and pay interest July 1 and January 1. Elkins Company uses the straight-line method to amortize bond premium or discount. Assume no interest is accrued on June 30.
Prepare all the necessary journal entries to record the issuance of the bonds and bond interest expense for 2011, assuming that the bonds sold at 104. (For multiple debit/credit entries, list amounts from largest to smallest e.g. 10, 5, 3, 2.)
Prepare journal entries as in the previous part of the question assuming that the bonds sold at 98. (For multiple debit/credit entries, list amounts from largest to smallest e.g. 10, 5, 3, 2.)
Show balance sheet presentation for each bond issue at December 31, 2011. (Enter all amounts as positive amounts and subtract where necessary.)
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