Assume the same facts as PB10-6, but now assume that Methodical uses the simplified effective interest bond

Question:

Assume the same facts as PB10-6, but now assume that Methodical uses the simplified effective interest bond amortization method, as shown in supplement 10C.
Required:
1. Prepare a bond amortization schedule.
2. Give the journal entry to record the bond issue.
3. Give the journal entries to record the interest payments on December 31, 2012 and 2013.
4. Give the journal entry to record the interest and payment on December 31, 2014.
5. Assume the bonds are retired on January 1, 2014, at a price of 101. Give the journal entry to record the bond retirement
Face Value
Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the...