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1. On January 1, 2003, Hi and Lois Company purchased 12% bonds having a maturity value of $300,000, for $322,744.44. The bonds provide the bondholders
1. On January 1, 2003, Hi and Lois Company purchased 12% bonds having a maturity value of $300,000, for $322,744.44. The bonds provide the bondholders with a 10% yield. They are dated January 1, 2003, and mature January 1, 2008, with interest receivable on December 31" of each year. Hi and Lois Company uses the effective interest method to allocate unamortized discount or premium. The bonds are classified as held- to- maturity. (a) Prepare the journal entry at the date of the bond purchase. (b) Prepare a bond amortization table. (c) Prepare the journal entry for the interest receive and the amortization for 2003. (d) Prepare the journal entry for the interest received and the amortization for 2004
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