Journal entry for the issuance of Bonds:
It is given that on December 31, 2015, wintergreen, inc., issued $150,000 of 7 percent, 10-year bonds at a price of 93.25. That means the proceeds from issue of these bonds are 150,000*93.25/100 = $139,875 and the discount on issue of bonds shall be = 150,000-139875 = $10,125.
The Journal entry for the issuance of Bonds shall be as follows:
December 31, 2015
Account Titles   Debit  Credit
Cash       $139,875
Discount on Bonds Payable  $10,125
Bonds Payable        $150,000
(Being bonds issued on discount)
