Webb Company has outstanding a 7% annual, 10-year, $100,000 face value bond that it had issued several
Question:
Webb Company has outstanding a 7% annual, 10-year, $100,000 face value bond that it had issued several years ago. It originally sold the bond to yield 6% annual interest. Webb uses the effective interest rate method to amortize the bond premium. On June 30, 20X1, the outstanding bond’s carrying amount was $105,000.
Required:
What amount of unamortized premium on the bond should Webb report in its June 30, 20X2, balance sheet?
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Related Book For 
Financial Reporting And Analysis
ISBN: 9781260247848
8th Edition
Authors: Lawrence Revsine, Daniel Collins, Bruce Johnson, Fred Mittelstaedt, Leonard Soffer
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