Ellis issues 6.5%, five-year bonds dated January 1, 2015, with a $250,000 par value. The bonds pay
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Ellis issues 6.5%, five-year bonds dated January 1, 2015, with a $250,000 par value. The bonds pay interest on June 30 and December 31 and are issued at a price of $255,333. The annual market rate is 6% on the issue date.
Required
1. Calculate the total bond interest expense over the bonds’ life.
2. Prepare a straight-line amortization table like Exhibit for the bonds’ life.
3. Prepare the journal entries to record the first two interest payments.
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Related Book For
Fundamental Accounting Principles
ISBN: 978-0077862275
22nd edition
Authors: John Wild, Ken Shaw, Barbara Chiappetta
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