The Following Transactions Were Completed by a Corporation

Essay

The following transactions were completed by a corporation:
(a) At the beginning of the year issued $25,000, 10 percent bonds payable (interest payable annually), due in 10 years, for $24,000 cash. Any bond premium or discount will be amortized on the straight-line basis. Give the entry to record the first interest payment.
(b) Issued 3,500 shares of its common shares and received cash, $17,500, which was credited in full to the common shares subscribed account. Give the required correcting entry:
(c) The working capital ratio for the company at the end of year one was 1.5 and the current assets, $156,750. Therefore, the current liabilities amounted to $______________________.