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Please provide explanations when you do your work. Thank you!! Unger Autoparts Inc. issued $150,000 of 9%, 10-year bonds at a price of 91 on
Please provide explanations when you do your work. Thank you!!
Unger Autoparts Inc. issued $150,000 of 9%, 10-year bonds at a price of 91 on January 31, 2020. The market interest rate at the date of issuance was 11%, and the standard bonds pay interest semi-annually. 1. Prepare an effective-interest amortization table for the bonds through the first three interest payments. 2. Record Unger's issuance of the bonds on January 31, 2020, and payment of the first semi-annual interest amount and amortization of the bonds on July 31, 2020. Explanations are not required. 1. Prepare an effective-interest amortization table for the bonds through the first three interest payments. (Round your answers to the nearest whole dollar.) Unger Autoparts Amortization Table D A B Interest Payment Interest Expense (5.5% of Bond Discount (4.5% of Maturity Preceding Bond Carrying Amortization (B Value) Amount) A) E Bond Carrying Amount ($150,000 -D) Semi-annual Interest Date Bond Discount Account Balance (Preceding D-C) 6750 7508 758 Jan. 31, 2020 July 31, 2020 Jan. 31, 2021 July 31, 2021 6750 6750 2. Record Unger's issuance of the bonds on January 31, 2020, and payment of the first semi-annual interest amount and amortization of the bonds on July 31, 2020. (Record debits first, then credits. Explanations are not required.) Start by recording the issuance of bonds on January 31, 2020. Date Accounts Debit Credit Jan. 31, 2020 Cash Discount on Bonds Payable Bonds Payable 2. Record Unger's issuance of the bonds on January 31, 2020, and payment of the first semi-annual interest amount and amortization of the bonds on July 31, 2020. (Record debits first, then credits. Explanations are not required.) Start by recording the issuance of bonds on January 31, 2020. Debit Credit Date Accounts Jan. 31, 2020 Cash Discount on Bonds Payable Bonds Payable Now, record the payment of the first semi-annual interest amount and amortization of the bonds on July 31, 2020. Debit Credit Date Accounts July 31, 2020 Interest Expense Discount on Bonds Payable Cash
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