WGU D104 LONG TERM LIABILITIES AND
BOND ACCOUNTING EXAM SCRIPT 2026
FULL PRACTICE QUESTIONS AND
ANSWERS
◉ Journal entry to record the issuance of a bond with a discount
dated 1/1/20 on 3/1/20
Answer: Debit cash, debit discount on bonds payable, credit bonds
payable, credit accrued interest payable.
◉ Journal entry to record a reacquisition price on a bond when it is
less than the current net carrying value and purchased at a premium
Answer: Debit bonds payable, debit unamortized premium on bonds
payable, credit cash, credit gain on bond retirement
◉ Journal entry to record a reacquisition price on a bond when it is
more than the current net carrying value and purchased at a
discount
Answer: Debit bonds payable, debit loss, credit the unamortized
discount, credit cash.
◉ Journal entry to record a retirement of bonds when the
reacquisition price is greater than the carrying value
, Answer: Debit bonds payable, debit the unamortized premium, debit
loss on bonds redemption, credit cash.
◉ Journal entry on retirement of bonds with a discount and loss
Answer: Debit bonds payable, debit loss on redemption of bonds,
credit discount, credit unamortized bond issue costs, credit cash
◉ Journal entry to record a note for a loan with five even
installments
Answer: Debit cash, credit current maturities of long term debt
(current year), credit long term debt (remaining)
◉ Journal entry to record interest on a note
Answer: Debit interest expense, credit cash.
◉ Journal entry to record the exchange of stock for land if the fair
value of the land is unknown
Answer: Debit land, credit common stock, credit additional paid-in
capital
◉ Journal entry to record the exchange of stock for land if the fair
value of the stock is unknown.
Answer: Debit land, credit common stock, credit additional paid-in
capital
BOND ACCOUNTING EXAM SCRIPT 2026
FULL PRACTICE QUESTIONS AND
ANSWERS
◉ Journal entry to record the issuance of a bond with a discount
dated 1/1/20 on 3/1/20
Answer: Debit cash, debit discount on bonds payable, credit bonds
payable, credit accrued interest payable.
◉ Journal entry to record a reacquisition price on a bond when it is
less than the current net carrying value and purchased at a premium
Answer: Debit bonds payable, debit unamortized premium on bonds
payable, credit cash, credit gain on bond retirement
◉ Journal entry to record a reacquisition price on a bond when it is
more than the current net carrying value and purchased at a
discount
Answer: Debit bonds payable, debit loss, credit the unamortized
discount, credit cash.
◉ Journal entry to record a retirement of bonds when the
reacquisition price is greater than the carrying value
, Answer: Debit bonds payable, debit the unamortized premium, debit
loss on bonds redemption, credit cash.
◉ Journal entry on retirement of bonds with a discount and loss
Answer: Debit bonds payable, debit loss on redemption of bonds,
credit discount, credit unamortized bond issue costs, credit cash
◉ Journal entry to record a note for a loan with five even
installments
Answer: Debit cash, credit current maturities of long term debt
(current year), credit long term debt (remaining)
◉ Journal entry to record interest on a note
Answer: Debit interest expense, credit cash.
◉ Journal entry to record the exchange of stock for land if the fair
value of the land is unknown
Answer: Debit land, credit common stock, credit additional paid-in
capital
◉ Journal entry to record the exchange of stock for land if the fair
value of the stock is unknown.
Answer: Debit land, credit common stock, credit additional paid-in
capital
