On January 2, 2007, $100,000 of 11%, 20-year bonds were issued for $97,000. The $3,000 discount was
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On January 2, 2007, $100,000 of 11%, 20-year bonds were issued for $97,000. The $3,000 discount was charged to Interest Expense. The bookkeeper, John Castle, records interest only on the interest payment dates of January 1 and July 1. What is the effect on reported net income for 2007 of this error, assuming straight-line amortiza- tion of the discount? What entry is necessary to correct for this error, assuming that the books are not closed for 2007?
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Related Book For
Intermediate Accounting 2007 FASB Update Volume 2
ISBN: 9780470128763
12th Edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
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