Jaggar Company sold $3,000,000, 8%, 10-year bonds on July 1, 2014. The bonds bond premium and discount.
Question:
Jaggar Company sold $3,000,000, 8%, 10-year bonds on July 1, 2014. The bonds bond premium and discount. were dated July 1, 2014, and pay interest July 1 and January 1. Jaggar Company uses the
(LO: 5), 1:1) straight-line method to amortize bond premium or discount. Assume no interest is ac-
— crued on June 30.
(a) Amortization $4,500
(b) Amortization $6,000 Instructions
(c) Premium on bonds payable
(a) Prepare all the necessary journal entries to record the issuance of the bonds and bond
$85,500 interest expense for 2014, assuming that the bonds sold at 103.
Discount on bonds payable —
(b) Prepare journal entries as in part
(a) assuming that the bonds sold at 96.
$114,000
(c) Show balance sheet presentation for each bond issue at December 31, 2014.
Step by Step Answer:
Financial Accounting
ISBN: 9780470929384
8th Edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso, J. Mather