Journalize the entry to record the amount of cash proceeds

Assignment Help Accounting Basics

Reference no: EM131977167

Problem

Can someone answer this question fully showing all work to how you got the answers please!!!!!!!!

Saverin, Inc. produces and sells outdoor equipment. On July 1, 2016, Saverin, Inc. issued $84,100,000 of 10-year, 8% bonds at a market (effective) interest rate of 6%, receiving cash of $96,612,297. Interest on the bonds is payable semiannually on December 31 and June 30. The fiscal year of the company is the calendar year.

Required: 1. Journalize the entry to record the amount of cash proceeds from the issuance of the bonds.

2. Journalize the entries to record the following:

a. The first semiannual interest payment on December 31, 2016, and the amortization of the bond premium, using the interest method. (Round to the nearest dollar.)

b. The interest payment on June 30, 2017, and the amortization of the bond premium, using the interest method.

3. Determine the total interest expense for 2016.

*Be sure to include the year in the date for the entries. Refer to the Chart of Accounts for exact wording of account titles.

Reference no: EM131977167

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