Using the data from Exercise 15-13, record the entries using the straight-line method for amortization of discounts and premiums.
In exercise 15-13
On June 1, 2015, Firefly Ltd. purchased $120,000 of 10-year, 6% Barron Company bonds at 93. The interest is received semiannually on June 1 and December 1. The company uses the effective interest method for amortization of discounts and premiums. The market rate on June 1, 2015, was 7%.
a. Journalize the entry to record the bond purchase.
b. Journalize the semiannual interest received and the discount amortization on December 1, 2015.
c. Journalize the accrued interest adjustment and discount amortization on December 31, 2015.
d. Journalize the receipt of the face amount of the bonds on the bond maturity date, June 1, 2025.