Question
need help with the following problem ASAP.Problem 14-2 (Part Level Submission) WindsorCo. is building a new hockey arena at a cost of $2,620,000. It received
need help with the following problem ASAP.Problem 14-2 (Part Level Submission)
WindsorCo. is building a new hockey arena at a cost of $2,620,000. It received a downpayment of $480,000from local businesses to support the project, and now needs to borrow $2,140,000to complete the project. It therefore decides to issue $2,140,000of12%,10-year bonds. These bonds were issued on January 1, 2016, and pay interest annually on each January 1. The bonds yield11%.
*(a)
Your answer is correct.
Prepare the journal entry to record the issuance of the bonds on January 1, 2016.(Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to 0 decimal places e.g. 58,971. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Date
Account Titles and Explanation
Debit
Credit
January 1, 2016
Cash
2266054.56
Bonds Payable
2140000.00
Premium on Bonds Payable
126054.56
(b)
a bond amortization schedule up to and including January 1, 2020, using the effective interest method.(Round answers to 0 decimal places, e.g. 38,548.)
Date
Cash
Paid
Interest
Expense
Premium
Amortization
Carrying
Amount of
Bonds
1/1/16$
$
$
$
1/1/17
1/1/18
1/1/19
1/1/20
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