On January 1, 2017, Methodical Manufacturing issued 100 bonds, each with a of $1,000, a stated interest rate of 5 percent, paid annually on December 31, and a date of December 31, 2019. On the issue date, the market interest rate was 4.25 percent, so the total proceeds from the bond issue were $102,070. Methodical uses the straight-line bond amortization method.
Required:
1. Prepare a bond amortization schedule.
2. Give the journal entry to record the bond issue.
3. Give the journal entries to record the interest payments on December 31, 2017 and 2018.
4. Give the journal entry to record the interest and payment on December 31, 2019.
5. Assume the bonds are retired on January 1, 2019, at a price of 102. Give the journal entries to record the bond retirement.
Enjoy 24/7 customer support for any queries or concerns you have.
Phone: +1 213 3772458
Email: support@gradeessays.com