Question
On January 1, 2001, Bradley Corporation issued six-year bonds with a face value of $250,000 and a contract rate of 9%. The annual interest
On January 1, 2001, Bradley Corporation issued six-year bonds with a face value of $250,000 and a contract rate of 9%. The annual interest payment dates are January 1. Bradley uses the straight line method of amortizing bond premium or discount and the bonds are sold at $239,111. 1. Prepare the journal entry to record the issue of bonds on January 1, 2001. 2. Complete the amortization table for the bond. (Please round all amounts to the nearest whole dollar) Date 1/1/01 12/31/0 1 12/31/0 2 12/31/0 3 12/31/0 4 12/31/0 5 12/31/0 6 Interest Expense Cash Interest Amortization of premium Bond Bond Discount or Face or discount paymen premium Balance Value Bond Carrying Value t --- --- 4. Record the adjusting entry for interest due on December 31, 2001 based on above.
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