Question
A company issues $15,700,000, 5.8% 20-year bonds to yield 6% on January 1, 2017. Interest paid on June 30 and December 31. The proceeds from
A company issues $15,700,000, 5.8% 20-year bonds to yield 6% on January 1, 2017. Interest paid on June 30 and December 31. The proceeds from the bonds are $15,337,098.
A. Using effective-interest amortization, how much interest will be recognized on June 30, 2017?
B. Using effective-interest amortization, what is the carrying value of the bond at June 30, 2017?
C. Using effective-interest amortization, how much interest expense will be recognized in 2017?
D. Using effective interest amortization, what is the carrying value of the bond at December 31, 2017?
E. Using effective-interest amortization, what is the balance in the premium or discount on bonds payable account at December 31, 2017?
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Intermediate Accounting
Authors: Donald E. Kieso, Jerry J. Weygandt, and Terry D. Warfield
15th edition
978-1118159644, 9781118562185, 1118159640, 1118147294, 978-1118147290
