Question
Bridgeport Co. sells $397,000 of 12% bonds on June 1, 2020. The bonds pay interest on December 1 and June 1. The due date of
Bridgeport Co. sells $397,000 of 12% bonds on June 1, 2020. The bonds pay interest on December 1 and June 1. The due date of the bonds is June 1, 2024. The bonds yield 8%. On October 1, 2021, Bridgeport buys back $127,040 worth of bonds for $132,040 (includes accrued interest). Give entries through December 1, 2022. Prepare a bond amortization schedule using the effective-interest method for discount and premium amortization. Amortize premium or discount on interest dates and at year-end. (Round answers to 0 decimal places, e.g. 38,548.)
Schedule of Bond Discount Amortization Effective-Interest Method Bonds Sold to Yield | ||||||||
Date | Cash Paid | Interest Expense | Premium Amortized | Carrying Amount of Bonds | ||||
6/1/20 | $ | $ | $ | $ | ||||
12/1/20 | ||||||||
6/1/21 | ||||||||
12/1/21 | ||||||||
6/1/22 | ||||||||
12/1/22 | ||||||||
6/1/23 | ||||||||
12/1/23 | ||||||||
6/1/24 |
* Difference due to rounding Prepare all of the relevant journal entries from the time of sale until December 31, 2022. (Assume that no reversing entries were made.) (
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