Project #76475 - Accounting II

Exercise 10-22

Cole Corporation issued $550,000, 6%, 23-year bonds on January 1, 2014, for $435,922. This price resulted in an effective-interest rate of 8% on the bonds. Interest is payable annually on January 1. Cole uses the effective-interest method to amortize bond premium or discount.

 
Prepare the schedule using effective-interest method to amortize bond premium or discount of Cole Corporation. (Round answers to 0 decimal places, e.g. 125.)

Interest
Periods
 
Interest to
Be Paid
 
Interest Expense
to Be Recorded
 
Discount
Amortization
 
Unamortized
Discount
 
Bond
Carrying Value
Issue date   $   $   $   $   $
1          
2          
 

Prepare the journal entries to record the issuance of the bonds. (Round answers to 0 decimal places, e.g. 125. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date
Account Titles and Explanation
Debit
Credit
Jan. 1, 2014
 
 
 

Prepare the journal entries to record the accrual of interest and the discount amortization on December 31, 2014. (Round answers to 0 decimal places, e.g. 125. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date
Account Titles and Explanation
Debit
Credit
Dec. 31, 2014
 
 
 

Prepare the journal entries to record the payment of interest on January 1, 2015. (Round answers to 0 decimal places, e.g. 125. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date
Account Titles and Explanation
Debit
Credit
Jan. 1, 2015
 
 

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Subject Mathematics
Due By (Pacific Time) 07/14/2015 10:45 pm
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