Question: On January 1 2016 Mason Corp sold 100 000 of its

On January 1, 2016, Mason Corp. sold $100,000 of its own 6 percent, 10-year bonds. Interest is payable annually on December 31. The bonds were sold to yield an effective interest rate of 5 percent. Mason Corp. uses the effective interest rate method. The bonds sold for $104,330.
Required
a. Prepare the journal entry for the issuance of the bonds.
b. Prepare the journal entry for the amortization of the bond premium and the payment of the interest on December 31, 2018.
c. Prepare the journal entry for the amortization of the bond premium and the payment of interest on December 31, 2018.
d. Calculate the amount of interest expense for 2019.
e. Calculate the amount of interest expense for 2019.

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  • CreatedApril 20, 2015
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