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On January 1, 2018, Irik Corporation issued $1,499,000 face value, 8%, 10-year bonds at $1,719,649. This price resulted in an effective-interest rate of 6% on
On January 1, 2018, Irik Corporation issued $1,499,000 face value, 8%, 10-year bonds at $1,719,649. This price resulted in an effective-interest rate of 6% on the bonds. The bonds pay annual interest, each January 1.
Prepare the journal entry to record the issue of the bonds on January 1, 2018. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit Dates Jan. 1, 2018 Prepare an amortization table through December 31, 2021 (three interest periods) for this bond issue. December 31 is the company's year-end. IRIK CORPORATION Bond Premium Amortization Effective Interest Method - Annual Interest Payments 8% Bonds Issued at 6% Interest to Be Paid Interest Expense to Be Recorded Premium Amortization Unamortize Premium $ Annual Interest Periods Issue date- Jan. 1/18 1 - Jan. 1/19 2 - Jan. 1/20 $ 3 - Jan. 1/21 Prepare an amortization table through December 31, 2021 (three interest periods) for this bond issue. December 31 is the company's year-end. IRIK CORPORATION Bond Premium Amortization Effective Interest Method - Annual Interest Payments 8% Bonds Issued at 6% Interest Expense Premium to Be Recorded Amortization Unamortized Premium Bond Carrying Amount $ $ $ Prepare the journal entry to record the accrual of interest and the amortization of the premium on December 31, 2018. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit Date Dec. 13, 2018 Prepare the journal entry to record the payment of interest on January 1, 2019. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Debit Credit Date Account Titles and Explanation Jan. 1, 2019Step by Step Solution
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