For Dingle Corporation, the following amortization table was prepared when $400,000 of five-year, 7 percent bonds were sold on December 31, 2011, for $420,000.

Required:
1. Prepare the entry to recognize the issuance of the bonds on December 31, 2011.
2. Prepare the entry to recognize the first interest payment on June 30, 2012.
3. Determine what interest expense for this bond issue Dingle will report in its 2013 income statement.
4. Indicate how these bonds will appear in Dingle's December 31, 2015, balance sheet.

Transcribed Image Text:

Interest Premium on Payment Expense Bonds Payable Bonds Payable Carrying 串 06/30/12 $14,000 $12,000 6