Entries for IssuingBondsand
AmortizingPremiumby StraightLine MethodDaan Corporation wholesales repair products to equipment
manufacturers. On April Daan Corporation issued $
of year, bonds at a market effective interest rate of
receiving cash of $ Interest is payable semiannually on
April and October aJournalize the entry to record the
issuance of bonds on April For a compound transaction, if
an amount box does not require an entry, leave it blank.bJournalize the entry to record the
first interest payment on October and amortization of bond
premium for six months, using the straightline method. The bond
premium amortization is combined with the semiannual interest
payment. Round to the nearest dollar. For a compound transaction,
if an amount box does not require an entry, leave it blank.cWhy was the company able to issue the
bonds for $ rather than for the face amount of
$The market rate of interest isthe contract
rate of interest.
