Brief Exercise 15-13 a-b Carla Vista Inc. issues $2,500,000, 5-year, 10% bonds at 101, with interest payable annually on January 1. The straight-line method is used to amortize bond premium.

Jan. 1 Cash 2,525,000 Premium on Bonds Payable 25,000 Bonds Payable 2,500,000 SHOW LIST OF ACCOUNTS SHOW SOLUTION SHOW ANSWER LINK TO TEXT Your answer is partially correct. Try again. Prepare the adjusting journal entry to record interest expense and bond premium amortization on Decem indent manually.) Date Account Titles and Explanation Debit Credit Dec. 31 Interest Expense 230,000 Premium on Bonds Payable 20,000 Interest Payable 250,000