Woodwick Company issues 10%, five-year bonds, on December 31, 2016, with a par value of $200,000 and
Question:
Woodwick Company issues 10%, five-year bonds, on December 31, 2016, with a par value of $200,000 and semiannual interest payments. Use the following bond amortization table and prepare journal entries to record
(a) the issuance of bonds on December 31, 2016;
(b) the first interest payment on June 30, 2017; and
(c) the second interest payment on December 31, 2017.
Semiannual Period-End Unamortized Premium Carrying Value
(0) 12/31/2016...........................$16,222...........................$216,222
(1) 6/30/2017..............................14,600.............................214,600
(2) 12/31/2017.............................12,978.............................212,978
Par ValuePar value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...
Step by Step Answer:
Fundamental Accounting Principles
ISBN: 978-1259536359
23rd edition
Authors: John Wild, Ken Shaw, Barbara Chiappett