(Solution) - BOND SINKING FUNDS Sheng Corporation pays 50 000 into a bond -(2025 Original AI-Free Solution)

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BOND SINKING FUNDS Sheng Corporation pays $50,000 into a bond sinking fund each year for the future redemption of bonds. At the end of the first year, earnings on the sinking fund are $4,750. When the bonds mature, there is a balance in the sinking fund of $502,125, of which $500,000 is used to redeem the bonds.
Prepare journal entries to record:
(a) The initial sinking fund deposit.
(b) The first year?s earnings.
(c) The redemption of the bonds.
(d) The return of excess cash to the corporation.