Question
Instructions Polk Incorporated issued $231,000 of 11% bonds on July 1, 2019, for $239,209.53. The bonds were dated January 1, 2019, pay interest on
Instructions Polk Incorporated issued $231,000 of 11% bonds on July 1, 2019, for $239,209.53. The bonds were dated January 1, 2019, pay interest on each June 30 and December 31, are due December 31, 2020, and were issued to yield 10%. Polk uses the effective interest method of amortization. Required: Prepare the journal entries to record the issue of the bonds on July 1, 2019, and the interest payments on December 31, 2019, and June 30, 2020. In addition, prepare a bond interest expense and premium amortization schedule for the bonds through June 30, 2020. Effective Interest Premium Amortization Instructions Chart of Accounts General Journal Analysis Instructions Analysis X Shaded cells have feedback. Bond Interest Expense and Discount Amortization Schedule (Partial) Effective Interest Method 11% Bonds Sold to Yield 10% Date Cash Credit Interest Expense Debit Unamortized Discount Credit Book Value of Bonds 07/01/19 $12,705.00 X $ $ $ 12/31/19 $12,705.00 $ $ $ 06/30/20 $12,705.00 $ $ $ Feedback Points: 4/12 Check My Work July 1, 2019: At the time of issue, the issuing company records the face value of bonds in a Bonds Payable account, and the proceeds received as a debit to the Cash account. If the bonde are issued with a contract interact rate that is greater than the affective interest rate the iccuor will record a premium in a conarate account titled Dromium on Donde
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