On December 31, 2026, when the market rate was 8%, West End Corp. issued $6,000,000, 11%,...
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On December 31, 2026, when the market rate was 8%, West End Corp. issued $6,000,000, 11%, 5-year bonds. Interest is payable semiannually on June 30 and December 31. The bonds were issued for $6,729,981, and the corporation uses the effective interest method of amortizing any bond premium or discount. REQUIRED: (a) Complete the amortization table below for the first two periods only. (USE EXCEL TEMPLATE TO COMPLETE YOUR ANSWER) Period ending Dec. 31/26 June 30/27 Cash interest paid Interest expense Premium/ Discount Amortization Carrying value Dec. 31/27 (b) Prepare the journal entries to record the issue of the bonds and the first interest payment. (c) West End Corp. retires its bonds on December 31, 2030 for cash of $6,200,000. At that date the bonds have a carrying value of $6,169,749. Prepare the journal entry to retire the bonds on December 31, 2030. On December 31, 2026, when the market rate was 8%, West End Corp. issued $6,000,000, 11%, 5-year bonds. Interest is payable semiannually on June 30 and December 31. The bonds were issued for $6,729,981, and the corporation uses the effective interest method of amortizing any bond premium or discount. REQUIRED: (a) Complete the amortization table below for the first two periods only. (USE EXCEL TEMPLATE TO COMPLETE YOUR ANSWER) Period ending Dec. 31/26 June 30/27 Cash interest paid Interest expense Premium/ Discount Amortization Carrying value Dec. 31/27 (b) Prepare the journal entries to record the issue of the bonds and the first interest payment. (c) West End Corp. retires its bonds on December 31, 2030 for cash of $6,200,000. At that date the bonds have a carrying value of $6,169,749. Prepare the journal entry to retire the bonds on December 31, 2030.
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a Amortization Table for West End Corp Bonds first two periods only Period endin... View the full answer
Related Book For
Intermediate accounting
ISBN: 978-0077647094
7th edition
Authors: J. David Spiceland, James Sepe, Mark Nelson
Posted Date:
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