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On March 31, 2021, Gardner Corporation received authorization to issue $80,000 of 9 percent, 30-year bonds payable. The bonds pay interest on March 31 and September 30. The entire issue was dated March 31, 2021, but the bonds were not issued until April 30, 2021. They were issued at face value. a. Prepare the journal entry at April 30, 2021, to record the sale of the bonds. b. Prepare the journal entry at September 30, 2021, to record the semiannual bond interest payment. c. Prepare the adjusting entry at December 31, 2021, to record bond interest expense accrued since September 30, 2021. (Assume that no monthly adjusting entries to accrue interest expense had been made prior to December 31, 2021.)

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anthougo

The journal entries to record the transactions of Gardner Corporation are as follows:

a. April 30, 2021

Debit Cash $80,000

Credit Bonds Payable $80,000

  • To record the issuance of the 9% bonds at face value.

b. September 30, 2021:

Debit Interest Expense $3,600

Credit Cash $3,600

  • To record the payment of 6-months interest.

c. December 31, 2021:

Debit Interest Expense $1,800

Credit Interest Payable $1,800

  • To accrue 3-months interest on bonds.

Data and Calculations:

Bonds payable = $80,000

Interest rate = 9%

Maturity period == 30 years

Interest payment = semi-annually

a. April 30, 2021 Cash $80,000 Bonds Payable $80,000

b. September 30, 2021: Interest Expense $3,600 Cash $3,600

($80,000 x 9% x 1/2)

c. December 31, 2021: Interest Expense $1,800 Interest Payable $1,800

($80,000 x 9% x 1/4)

Learn more about recording issuance of bonds at https://brainly.com/question/16048929

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