On January 1, 2013, Roosevelt Company issued 12% bonds, having a maturity value of $500,000. The bonds
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Question:
On January 1, 2013, Roosevelt Company issued 12% bonds, having a maturity value of $500,000. The bonds provide the bondholders with a 10% yield, and mature on 1 January, 2018, with interest receivable on 31 December of each year. Roosevelt Company uses the effective-interest method to allocate unamortized discount or premium. The reporting date of Roosevelt Company is 31 December.
Required:
(a) Prepare the journal entry at the bond issuing day.
(b) Prepare a bond amortization schedule.
(c) Prepare the journal entry to record the interest received and the amortization for 2013.
Related Book For
Financial Accounting Theory and Analysis Text and Cases
ISBN: 978-1118582794
11th edition
Authors: Richard G. Schroeder, Myrtle W. Clark, Jack Cathey
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