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On May 1, 2018, ABC Corporation purchased $1,500,000 of 12% bonds, interest payable on January...

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Question

Accounting

On May 1, 2018, ABC Corporation purchased $1,500,000 of 12% bonds, interest payable on January 1 and July 1, for $1,406,500 plus accrued interest. The bonds mature on January 1, 2024. Amortization is recorded when interest is received by the straight-line method (by months and round to the nearest dollar). (Assume bonds are available for sale.)

Instructions

Complete the Interest Revenue Received and Bond Amortization Schedule.

Date Cash Received Interest Revenue Bod Discount Amortization

Carrying Amount of Bonds
1/1/18 $1,406,500

7/1/18
1/1/19
7/1/19
1/1/20
7/1/20
1/1/21
7/1/21
1/1/22
7/1/22
1/1/23
7/1/23
1/1/24

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