Question

On May 1, 201X, Leffer Corporation issued $180,000 of 12%, 5-year bonds for $193,918, yielding a market rate of 10%. Interest is paid on October 1 and May 1. Leffer Corporation uses the interest method to amortize the premium.
1. Prepare an amortization schedule for the first three semiannual periods.
2. Prepare journal entries to record the following:
a. Bond issue on May 1.
b. Semiannual interest payment and amortization of premium on August 1.
c. The year-end adjusting entry to record interest expense and premium amortization.



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  • CreatedApril 24, 2014
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