P15-2A Kusmaul Electric sold $500000 10% 10-year bonds on January 1 2010. The bonds were dated January 1 and paid interest on January 1 and July 1. The bonds were sold at 104. Hint: Prepare entries to record issuance of bonds interest accrual and bond redemption. (SO 2 3 6) Instructions (a) Prepare the journal entry to record the issuance of the bonds on January 1 2010. (b) At December 31 2010 the balance in the Premium on Bonds Payable account is $18000. Show the balance sheet presentation of accrued interest and the bond liability at December 31 2010. (c) On January 1 2012 when the carrying value of the bonds was $516000 the company redeemed the bonds at 105. Record the redemption of the bonds assuming that interest for the period has already been paid. Loss $9000

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