70.2K

Verified Solution

Link Copied!

Recording Bond Entries and Preparing an Amortization Schedule-Effective Interest Method, Premium Mitchell Inc. issued 96,6%, $1,000 bonds on January 1, 2020. The bonds pay cash interest semiannually each June 30, and December 31, and were issued to yield 5%. Thelbonds mature December 31, 2024, and the company uses the effective interest method to amortize bond discounts or premiums. Required a. Determine the selling price of the bonds. Round amount to the nearest whole dollar. b. Prepare an amortization schedule for the full bond term. c. Prepare journal entries on the following dates. 1. January 1, 2020, bond issuance. 2. June 30, 2020, interest payment. 3. December 31, 2020, interest payment. Bond Selling Price Amortization Schedule Journal Entries a. Selling price of bonds $ Bond Selling Price Amortization Schedule Journal Entries b. Note: Round amounts in schedule to the nearest whole dollar. Use rounded amounts for later calculations in the schedule. Note: Include any net rounding difference for Bond Payable, Net in the interest expense amount for Dec. 31. 2024. Cash Interest Expense Discount Amortization Bonds Payable, Net $ $ I Date Jan. 1, 2020 June 30, 2020 $ Dec 31, 2020 June 30, 2021 Dec 31, 2021 June 30, 2022 Dec 31, 2022 June 30, 2023 Dec 31, 2023 June 30, 2024 Dec 31, 2024 Total $ $ $ Bond Selling Price Amortization Schedule Journal Entries Note: List multiple debits or credits (when applicable) in alphabetical order. Note: Round your answers to the nearest whole dollar Date Account Name 1. Jan 1, 2020 Dr. . Cr. e . . 2. June 30, 2020 3. Dec 31, 2020 Check

Answer & Explanation Solved by verified expert

See Answer