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On January 1, 2017, Bonita Company purchased $260,000, 6% bonds of Aguirre Co. for $238,911. The bonds were purchased to yield 8% interest. Interest is
On January 1, 2017, Bonita Company purchased $260,000, 6% bonds of Aguirre Co. for $238,911. The bonds were purchased to yield 8% interest. Interest is payable semiannually on July 1 and January 1. The bonds mature on January 1, 2022. Bonita Company uses the effective-interest method to amortize discount or premium. On January 1, 2019, Bonita Company sold the bonds for $240,370 after receiving interest to meet its liquidity needs.
Prepare the amortization schedule for the bonds.
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