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Q3. On June 1, 2020, Thor Cola Company sold $1,000,000 in long-term bonds for $877,600. The bonds will mature in 10 years and have a
Q3. On June 1, 2020, Thor Cola Company sold $1,000,000 in long-term bonds for $877,600. The bonds will mature in 10 years and have a stated interest rate of 8% and a yield rate of 10%. The bonds pay interest annually on May 31 of each year. The bonds are to be accounted for underthe effective-interest method. Instructions [Marks: 12] (a) Construct a bond amortization schedule with proper columns and rows. Include only the first three years.(Round to the nearest dollar) (b) Assume, interest and discount amortization are recorded each May 31. Prepare the adjusting entry to be made on December 31, 2022. (Round to the nearest dollar)
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