The Long-Term Debt section of Rodman Companys balance sheet as of December 31, 2010, included 8% bonds payable of $300,000 less unamortized discount of $22,000. Further examination revealed that these bonds were issued to yield 11%. The amortization of the
The Long-Term Debt section of Rodman Company’s balance sheet as of December 31, 2010, included 8% bonds payable of $300,000 less unamortized discount of $22,000. Further examination revealed that these bonds were issued to yield 11%. The amortization of the bond discount was recorded using the effective-interest method. Interest was paid on January 1 and July 1 of each year. On July 1, 2011, Rodman retired the bonds at 104 before maturity.
Prepare the journal entries to record the July 1, 2011, payment of interest, including the amortization of the discount since December 31, 2010, and the early retirement on the books of Rodman Company.
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
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2011 July 1 Interest Expense 300000 008 612 12000 Cash 12000 Interest Expense 3290 Disco…View the full answer
Related Book For 
Intermediate Accounting
ISBN: 978-0324592375
17th Edition
Authors: James D. Stice, Earl K. Stice, Fred Skousen
Question Details
Chapter #
12
Section: Practice Exercises
Problem: 34
Posted Date: January 28, 2012 05:36:14
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