Question

On January 1, 2010, Rodgers Company purchased $200,000 face value, 10%, three-year bonds for $190,165.35, a price that yields a 12% effective annual interest rate. The bonds pay interest semiannually on June 30 and December 31.

Required
1. Record the purchase of the bonds.
2. Prepare an investment interest revenue and discount amortization schedule, using the effective interest method.
3. Record the receipts of interest on June 30, 2010, and June 30, 2012.



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  • CreatedDecember 09, 2013
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