4TI
Question
Herrera Corporation issued a $400,000, 4.5%, 10-year bond payable on January 1, 2018. Journalize the payment of the bond
payable at maturity. (Give the date.)
Step-by-Step Solution
Verified Answer
The bond payable debited and cash account is credited with $400,000 when the payment of the bonds is made.
1Step 1: Definition of bonds
The bond is a type of long-term liability in which the company issues bonds to the general public for a fixed period.
2Step 2: Journal entry at maturity of bonds
Date | Particulars | Debit | Credit |
January 1, 2028 | Bonds Payable | $400,000 |
|
| Cash |
| $400,000 |
| (Being entry for the payment of the bond at maturity) |
|
|
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