Question
Exercise 9-17A Record the early retirement of bonds issued at a premium (LO9-6) [The following information applies to the questions displayed below.] On January 1,
Exercise 9-17A Record the early retirement of bonds issued at a premium (LO9-6)
[The following information applies to the questions displayed below.]
On January 1, 2021, White Water issues $600,000 of 7% bonds, due in 10 years, with interest payable semiannually on June 30 and December 31 each year. The market interest rate on the issue date is 6% and the bonds issued at $644,632.
Exercise 9-17A Part 1
Required: 1. Using an amortization schedule, show that the bonds have a carrying value of $633,887 on December 31, 2023.
Required information
Exercise 9-17A Record the early retirement of bonds issued at a premium (LO9-6)
[The following information applies to the questions displayed below.]
On January 1, 2021, White Water issues $600,000 of 7% bonds, due in 10 years, with interest payable semiannually on June 30 and December 31 each year. The market interest rate on the issue date is 6% and the bonds issued at $644,632.
Exercise 9-17A Part 2
2. If the market interest rate increases to 8% on December 31, 2023, it will cost $568,311 to retire the bonds. Record the retirement of the bonds on December 31, 2023.
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