Bond Payable Account - Printable Version +- Accountancy Forum (https://www.accountancy.com.pk/forum) +-- Forum: The Profession (https://www.accountancy.com.pk/forum/forumdisplay.php?fid=4) +--- Forum: Accounting and Audit (https://www.accountancy.com.pk/forum/forumdisplay.php?fid=7) +--- Thread: Bond Payable Account (/showthread.php?tid=7706) |
Bond Payable Account - snyk8122 - 03-28-2010 Help! I am stuck with regards to the following. On Jan 1, 2005, X Company has a bond payable of $200,000. During 2005, it pays off $20,000 of the outstanding bond principal and issues a new $70,000 bond. There are no other transactions related to the bond payable account. How would you recommend I find X company's December 31, 2005 bond payable balance? I'm guessing it's either a debit balance of $250,000, or of $150,000, or a credit balance of $150,000 or $250,000 but I'm not sure how to figure out which is correct. Thank you for your help ) - Qureshi Muhammad Zeeshan - 03-28-2010 just make a T account of this and u will get the Answer of this. its so simple - Ajnabi - 03-29-2010 <blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by snyk8122</i> <br />Help! I am stuck with regards to the following. On Jan 1, 2005, X Company has a bond payable of $200,000. During 2005, it pays off $20,000 of the outstanding bond principal and issues a new $70,000 bond. There are no other transactions related to the bond payable account. How would you recommend I find X company's December 31, 2005 bond payable balance? I'm guessing it's either a debit balance of $250,000, or of $150,000, or a credit balance of $150,000 or $250,000 but I'm not sure how to figure out which is correct. Thank you for your help ) <hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote"> Bonds Payable is a liablity account by nature, so any positive balance will always be shown on credit side, and decrease has to be shown on debit side. Based on these facts; Credit Balance in Bonds payable was initially.------------------------$200,000 Redemptions of Bonds will be debited to bonds payable account---------$20,000 New Issuance will be credited to account -----------------------------$70,000 Bonds payable account should indicate Credit balance-------------------$250,000 at the end. Ajnabi |