Discuss company uses straight-line amortization and adjusts

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Reference no: EM131781538

Complete the journal entry

Southwest Corporation issued bonds with the following details:

Face value: $640,000

Interest: 10 percent per year payable each December 31

Terms: Bonds dated January 1, 2015, due five years from that date

The annual accounting period ends December 31. The bonds were issued at 103 on January 1, 2015, when the market interest rate was 9 percent. Assume the company uses straight-line amortization and adjusts for any rounding errors when recording interest expense in the final year.

Reference no: EM131781538

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