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Current Attempt in Progress On January 1, 2020, Sage Company sold 11% bonds having a maturity value of $500,000 for $559,889, which provides the bondholders
Current Attempt in Progress On January 1, 2020, Sage Company sold 11% bonds having a maturity value of $500,000 for $559,889, which provides the bondholders with a 8% yield. The bonds are dated January 1, 2020, and mature January 1, 2025, with interest payable December 31 of each year. Sage Company allocates interest and unamortized discount or premium on the effective-interest basis. (a) Your answer is correct. Prepare the journal entry at the date of the bond issuance. (Round answer to 0 decimal places, eg. 38,548. If no entry is required, select "No Entry" for the account titles and enter for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit January 1,20 Cash 559,889 Bonds Payable 500,000 Premium on Bonds Payable 59,889 (b) Your answer is partially correct. Prepare a schedule of interest expense and bond amortization for 2020-2022. (Round answer to 0 decimal places, eg. 38,548.) Schedule of Interest Expense and Bond Premium Amortization Effective-Interest Method Interest Premium Expense Amortized Cash Paid Date 1/1/20 $ i $ i $ i $ 12/31/20 60000 44123 15877 12/31/21 60000 42853 17147 [ 12/31/22 60000 41482 18518 b) Your answer is partially correct. Prepare a schedule of interest expense and bond amortization for 2020-2022. (Round answer to 0 decimal places, e.g. 38,548.) Schedule of Interest Expense and Bond Premium Amortization Effective-Interest Method Interest Premium Expense Amortized Cash Paid Carrying Amount of Bonds $ i $ i $ 551543 60000 44123 15877 535666 60000 42853 17147 518519 60000 41482 18518 500000
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