Solution-Prepare the first two years of an amortization

Prepare the first two years of an amortization table

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Reference no: EM132509693

Question - Hillside issues $4,000,000 of 6%, 15-year bonds dated January 1, 2013, that pay interest semiannually on June 30 and December 31. The bonds are issued at a price of $3,456,448

Required -

1. Prepare the January 1, 2013, journal entry to record the bonds' issuance.

2(a) For each semiannual period, calculate the cash payment

2(b) For each semiannual period, calculate the straight-line discount amortization.

2(c) For each semiannual period, calculate the bond interest expense.

3. Calculate the total bond interest expense to be recognized over the bonds' life.

4. Prepare the first two years of an amortization table using the straight-line method with these dates for a "unamoritized discount" and a "carrying Value":

01/01/2013

6/30/2013

12/31/2013

06/30/2014

12/31/2014

5. Prepare the journal entries to record the first two interest payments.

a. Record the first interest payment on June 30, 2013.

b. Record the second interest payment on December 31, 2013.

Reference no: EM132509693

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Prepare the first two years of an amortization table

Reference no: EM132509693

Reference no: EM132509693

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