Alpha Corporation issued 100000 of 3 15year bonds on June 1

Alpha Corporation issued $100,000 of 3%, 15-year bonds on June 1, 2016 (dated April 1 2016) at 101 plus accrued interest, which is paid on April 1 and October 1.

Use this information to prepare the General Journal entry (without explanation) to record the June 1, 2016 bond issue. If no entry is required then write \"No Entry Required.\"

General Journal:

Date

Accounts

Debit

Credit

6/1/16

Solution

General Journal:

Date

Accounts

Debit

Credit

6/1/16

Cash

100,500

Bonds Payable

100,000

Interest payable

500

Bonds issued on February 1 at 101 plus accrued interest

Interest for 2 months (i.e., from April 1 2016 to June 1 2016) will be received by corporation at the time of issue - $100,000 X 3% X 2/12 = $ 500 along bond value