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ACC Problem 14-5 - Sanford Co.

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Question;Sanford Co. sells $518,200 of 8% bonds on March 1, 2014. The bonds pay interest on September 1 and March 1. The due date of the bonds is September 1, 2017. The bonds yield 12%.Prepare a bond amortization schedule using the effective-interest method for discount and premium amortization. Amortize premium or discount on interest dates and at year-end.Schedule of Bond Discount AmortizationEffective-Interest MethodBonds Sold to YieldDate3/1/20149/1/20143/1/20159/1/20153/1/20169/1/20163/1/20179/1/2017CashPaid$InterestExpense$DiscountAmortized$CarryingAmountofBonds$Prepare all of the relevant journal entries from the time of sale until the date indicated. (Assume that no reversing entries were made.) (Round answers to 0 decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)Date3/1/20149/1/201412/31/20143/1/20159/1/201512/31/2015AccountTitlesandDebitExplanationCredit

 

Paper#40115 | Written in 18-Jul-2015

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