The Taylor Company issued $100,000 of 13% bonds on January 1, 2007. The bonds pay interest semiannually
Question:
The Taylor Company issued $100,000 of 13% bonds on January 1, 2007. The bonds pay interest semiannually on June 30 and December 31 and are due December 31, 2009.
Required
1. Assume the company sells the bonds for $102,458.71 to yield 12%. Prepare the journal entries to record:
a. The sale of the bonds.
b. Each 2007 semiannual interest payment and premium amortization, using the effective interest method.
2. Assume the company sells the bonds for $97,616.71 to yield 14%. Prepare the journal entries to record:
a. The sale of the bonds.
b. Each 2007 semiannual interest payment and discount amortization, using the effective interest method.
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1 a 2007 Jan 1 Cash 10245871 Premium on Bonds Payable 245871 Bonds Payable 10000000 TAYLOR COMPANY Bond Interest Expense and Premium Amortization Sche...View the full answer
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Related Book For 
Intermediate Accounting
ISBN: 978-0324300987
10th Edition
Authors: Loren A Nikolai, D. Bazley and Jefferson P. Jones
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