Problem 126 (Part Level Submission) On June 1, 2016, Everly Bottle Company sold $3,000,000 in...
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Accounting
Problem 126 (Part Level Submission)
On June 1, 2016, Everly Bottle Company sold $3,000,000 in long-term bonds for $2,631,300. The bonds will mature in 10 years and have a stated interest rate of 8% and a yield rate of 10%. The bonds pay interest annually on May 31 of each year. The bonds are to be accounted for under the effective-interest method.
(a)
Construct a bond amortization table for this problem to indicate the amount of interest expense and discount amortization at each May 31.
Date
Credit Cash
Debit Interest Expense
Credit Bond Discount
Carrying Amount of Bonds
6/1/16
$
5/31/17
$
$
$
5/31/18
5/31/19
5/31/20
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