What Is The Journal Entry For Issuing Bonds? To record bonds issued at face value plus accrued interest. This entry records the $5,000 received for the accrued interest as a debit to Cash and a credit to Bond Interest Payable. To record bond interest payment. This entry records $1,000 interest expense on the $100,000 of
Why Would A Company Choose To Issue Bonds Instead Of Issuing Stock? There are several advantages of issuing bonds (or other debt) instead of issuing shares of common stock: Interest on bonds and other debt is deductible on the corporation’s income tax return while the dividends on common stock are not deductible on the income
Do Companies Get Repaid For Bond Issue Costs? Bond issue costs are not treated as outright expense but amortized over the life of the bond similar to that for discount on bonds payable. Bond issue costs are conceived as cost of borrowing and therefore will increase interest expense. How does a company pay back a